In brief letter to Pres Trump yesterday, Beer Inst ceo Jim McGreevy urged him to "lift the 232 tariffs on imported aluminum." Jim noted that US bev industry has paid $582 mil in aluminum tariffs since Mar 2018 ("a dramatic cost increase"), with US govt collecting just 14% of that (see Monday's Express). "Lifting the tariffs would provide our nation's brewers with immediate and essential relief," Jim wrote.

Showing once again that preliminary injunctions are an "extraordinary remedy" tuff to obtain, fed ct judge in Tex refused to grant one to Future Proof, makers of Brizzy hard seltzer. Recall, Brizzy tried to halt pending launch of MC's big seltzer bet Vizzy. But judge determined there was "no likelihood of confusion in the minds of potential consumers as to the 'source of affiliation or sponsorship' of the product at issue." That consumer confusion necessary to halt a competing product under trademark law. Turns out there are a handful and a half of "digits" (8 to be exact) courts use to weigh potential confusion. Judge granted that three of 'em weighed in Brizzy's favor: similarity of product (yep, they're both hard seltzers), retail outlets where available and media where ads would run. But other digits more dispositive and weighed in MC favor. First, Brizzy mark ain't very distinctive. Both bevs are carbonated, use common "root," and rhyme with "fizzy." And there's a bunch of other bevs that already do the same: i.e. Izze, Bizzy, Fizzy, etc. Thus, "conceptual strength" of Brizzy mark is "weak." What's more, marks ain't that similar. Vizzy's "logos, font, coloring, cans and packaging could not be more different," judge notes. Another digit for MC.

With Leap Day, Feb $$ sales in control states leapt 8%+, reports NABCA, before pantry loading really kicked into high gear. (Nielsen reports spirits' off-premise sales zoomed 26.4% in week ending Mar 14.) But even after equivalizing for sell days, control state spirits volume continued to rise 2.4% in Feb, with $$ sales +5.4%. That was slightly below running 12-mo trends of +3.5% and +6.1% respectively, but still healthy. Interestingly, pre-made cocktails, tho a small 2 share of control state liquor sales, led growth, +19%. And vodka picked up its pace, with volume +5.3%. So, looks like seltzers still haven't cut into the liquor categories you'd expect them to.

Pernod Ricard put out guidance for its fiscal 2d half (Jan-Jun) yesterday that is truly sobering. And a cautionary note for all in alc bevs in age of COVID-19. Pernod said that its full fiscal yr (Jan-Jul) operating profits would be down 20%. That implies Jan-Jun profits down 60%, pointed out Consumer Edge's Brett Cooper, who also said: "Pernod offered a realistic view of the world." What's more "the pressure from the COVID-19 won't stop on July 1st… profit pressure will continue at least into 1H21." Here are a few specific assumptions from Pernod, more globally based but with obvious read-thrus for beer and brewers. In China "very limited business in February and March; slow recovery from April." Check out Pernod's eye opening assumption on "travel retail": "80% business decline for the period from February to end June." And there's more: off-trade (off premise), which is ¾ of sales, see 10% reduction from Mar-Jun. And on-trade, about ¼ of biz, will see "no sales from mid-March to end June, as outlets are shut or not reordering." This will be a tuff period.

So much for putting aside policy differences amidst a natl health crisis. Recall, last Thurs, Wine & Spirits Wholesalers Assn (WSWA) ceo Michelle Korsmo sent letter to governors asking them to keep alc bev retailers open, citing risks of black mkt/illegal sales if system shut down, among other things (see Mar 20 Express). In press release yesterday, Natl Assn of Wine Retailers, which aggressively supports crossborder shipping rights for alc bev retailers, blasted Michelle's letter as next in long line of "self-serving arguments for closed, state-based markets that uphold artificial protections from competition." What's more, the "anti-diluvian, yet well-heeled" WSWA resisted direct shipping from wineries for years, NAWR exec director Tom Wark reminded, "spreading the gospel of anti-consumer, draconian, archaic, self-serving laws meant to protect middleman wholesalers' bottom lines at the expense" of consumer interests and alc bev biz expansion. There's more nastiness, but in a nutshell, NAWR charges WSWA with attempting to exploit coronavirus crisis via "politicking" and "fear mongering" to "prevent the entirely safe practice of interstate alcohol shipments from licensed retailers," and keep consumers from obtaining the products they seek online and receiving them via common carrier. WSWA's tactics, Tom sums up, to support "middlemen's financial interests" are "cringeworthy." Instead, states "ought to be enabling consumers and help them to stay safe by passing legislation to allow the receipt of wine shipments from both in-state and out-of-state retailers and wineries in a well-regulated way. Every state should allow curbside pickup." (Recall, Michelle had also asked states to allow curbside pickup, as well as delivery and alc bev sales by restaurants for take-out/ delivery orders.)

Boston Beer's Truly hard seltzer is among brands getting truly bolstered by pantry loading of late, coming off its "biggest week of depletions ever," co shared. Total depletions grew more than 270% last week, now putting Truly as 16th largest brand among all beer. Truly had been growing at ~195% rate YTD in Nielsen scan data thru Mar 14. Truly managed to gain 1.8 share of hard seltzers since Bud Light Seltzer launch, while White Claw (-12.7), Natty Seltzer (-1) and Bon & Viv (-1.6) all lost share, according to Boston, "which further demonstrates Truly's ability to capture a different drinker than our competitors," sez co. Main reason for Truly's share gain is new Truly Lemonade. The lemonade variety pk already became a top-100 beer brand in scans YTD thru Mar 8, according to separate IRI MULC data from Bump Williams Consulting. And in latest week, it became 6th largest hard seltzer SKU, snagging 4.4 share of hard seltzer for period, per Boston.

Diageo North America prexy Dierdre Mahlan will retire on Jun 30, co announced today. She had that role for last 5 yrs, prior to that cfo of Diageo North America for 5 yrs. So she's worked very closely with ceo Ivan Menezes. In that five yr period, not only has total Diageo North America performed well, but Diageo Beer Co USA has turned around on her watch, first under Tom Day and more recently led by Nuno Teles. In Diageo's fiscal first half, North America revs up 6%, oper income up 2%. North America is half of Diageo's total operating profit. Dierdre's replacement will be Debra Crew, who's been on Diageo's board for about 1 yr. Debra is former prexy of Reynolds American, previously prexy of RJ Reynolds. She worked many yrs at Pepsi too. "Diageo will face pressures from on-premise closures and the follow-on economic impacts," wrote Consumer Edge's Brett Cooper this morn (before announcement). But "they simply have more levers to pull than many of their peers." That wasn't only big Diageo personnel announcement this morn. Global cmo Syl Saller will "depart Diageo to focus on leadership development, executive coaching and non-executive roles," according to Spirits Business. She will be replaced by another Diageo exec Cristina Diezhandino.

Proposed franchise law in California has already drawn the scorn of the Fed Trade Comm. In 13-page letter dated Mar 20, FTC declared that proposed AB 1541: 1) is "likely to reduce wholesaler incentives to provide important demand-enhancing services" and "reduce competition" among distribs to carry brewers' brands; 2) "may disproportionately" raise distribution costs for small brewers; 3) will increase consumer prices and reduce variety. Bill ignores consumer interests, sez FTC. And burdens it imposes on brewers "do not seem calibrated to address any particular bargaining asymmetries between brewers and wholesalers and we are pessimistic that they could." Finally, while FTC deems that bill will "impede competition in California beer distribution," it sees "no countervailing consumer protection benefits in evidence." FTC urges Calif legislature to reject the bill.

Hadda happen. Overnight, ABI followed many other major corporations and withdrew its 2020 earnings guidance. It had expected 2-5% EBITDA gain, concentrated in 2d half. "Given the uncertainty, volatility and fast moving developments of the pandemic in the markets in which AB InBev operates, the company is withdrawing that 2020 Outlook in its entirety because of the impact of COVID-19." ABI and Asahi also each said that their deal for Asahi to buy ABI's Australian beer biz for $11 bil, announced last July, will be delayed until 2d qtr. While Asahi originally "expected" transaction to "take place" in Q1 2020, "we are now expecting the completion to occur in second quarter of 2020," Asahi said. The reason why: Australian regulators "are still reviewing the proposed transaction," so "there's likely to be a delay." So now Asahi "continuing endeavors to complete the proposed transaction as early as possible" in Q2. Bernstein's Trevor Stirling wrote that ABI "reassures on the sale of Australia to Asahi," but "process is taking longer than expected and Asahi may ultimately have to tweak its proposed remedies. In our view both parties want this to go through." ABI sure could use the coin, still sitting on over $100 bil in debt. In a review of "The World's Most Indebted Companies" that came out last night in Global Finance, ABI ranked as #5. A dubious distinction. The world's most indebted co is currently AT&T, with debt listed at $151 bil, while ABI listed at $102 bil.