Canadian Manufacturing

Canadian brewer brings craft beer trend to South Korea

British Columbia's Dan Vroon battled regulations and high-powered competition to tap the market

TORONTO—Dan Vroon says he didn’t set out to transform the South Korean beer industry, but the Abbotsford, B.C., native’s attempt to bring craft beer to the masses has kick-started a revolution in a market long dominated by a duopoly.

Vroon’s Craftworks Taphouse and Bistro in Seoul was one of the first in a new wave of craft breweries that have renewed interest in craft beer in the country, a market long dominated by a local duopoly.

Vroon said before he entered the business in 2010, imports of North American brews from the Boston Beer Company and Edmonton’s Alley Cat Brewing Company were the only way for South Korea’s large ex-pat community to get a taste of home.

He set out to build a craft brewery to serve that crowd, as well as locals looking for something other than the rice-based, low-alcohol lagers from Hite Brewery Company and Oriental Brewing that dominate South Korean taps.

“They were missing the market entirely,” he said.

Vroon said he ran up against the thicket of regulation that had stopped the flow of beer from other craft breweries, even after an early-2000s push from the South Korean government to open up its beer industry.

Vroon pushed back against rules that required breweries have more than one million litres of capacity before selling to wholesalers, which he said essentially prevented anyone but the largest brewers from distributing their products.

He said he also pushed for transparency on taxation after the first brewery he worked with was nearly bankrupted by an unexpected tax bill more than ten times what authorities had predicted.

He said he did his best to work within rules that prevented or made prohibitively expensive the importing of the yeast and hops necessary to make a top-quality brew.

“The brewing laws were written in the 1950s,” he said. “Nobody was around who understood them.”

Vroon’s efforts soon bore fruit as he found the South Korean government receptive to new ideas that could promote local business.

In 2011, the government reduced the distributing requirement from one million litres of capacity to 120,000 litres, one of the first in a series of reforms that Vroon said has reinvigorated the craft beer market.

And as more breweries come online, he said, there are more voices pressuring the government for reform.

“They haven’t given us everything, but they’ve definitely freed up the brewers to distribute their beer, cut some of the taxation and gave rebates for the smaller guys,” Vroon said. “Now, the craft beer scene is booming.”

Some of the beers Craftworks offers: the Jirisan Moon Bear India Pale Ale, the Seorak Oatmeal Stout and Baekdusan unfiltered wheat beer.

Vroon’s work in developing a craft-brew palate among South Koreans has inspired others to bring in Canadian beer to meet the rising demand.

Brock Rodgers, co-founder of the Mission Springs Brewery in Mission, B.C., now exports around 40 per cent of his production of hops-heavy, full-flavoured beers to South Korea after beginning shipments in 2013.

“At that time, Dan (Vroon) was the only guy in town that was doing anything craft and doing it well,” he said.

Rodgers said even with significant import taxes on his products that send the price well above domestic competition, his business is doing well because they are viewed as a premium product.

“There’s a somewhat well-founded belief over there that products from Canada are healthier, that the water’s better, the air is better,” he said. “If it’s made in Busan it kind of loses whatever authenticity it might have.”

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