Purchasing Wash from a Brewery

[Palmetto Coast]

I was talking to a brewery about purchasing beer for distillation. I thought this was a viable option, but this is all I can find. Does anyone else do this? If so, can you please explain it. According to the TTB, this is the only way.

Removal of Beer to a Contiguous Distilled Spirits Plant

§ 25.201 Removal by pipeline.

A brewer may remove beer from the brewery, without payment of tax, by pipeline to the bonded premises of a distilled spirits plant which is authorized to produce distilled spirits and which is located contiguous to the brewery.

(Sec. 201, Pub. L. 85–859, 72 Stat. 1365, as amended, 1389, as amended (26 U.S.C. 5222, 5412))

[BWFiggins]

I was talking to a brewery about purchasing beer for distillation. I thought this was a viable option, but this is all I can find. Does anyone else do this? If so, can you please explain it. According to the TTB, this is the only way.

Removal of Beer to a Contiguous Distilled Spirits Plant

§ 25.201 Removal by pipeline.

A brewer may remove beer from the brewery, without payment of tax, by pipeline to the bonded premises of a distilled spirits plant which is authorized to produce distilled spirits and which is located contiguous to the brewery.

(Sec. 201, Pub. L. 85–859, 72 Stat. 1365, as amended, 1389, as amended (26 U.S.C. 5222, 5412))

Perfect! Yes this is quite allowable provided that your DSP is adjacent to the brewery in question. Mine is, but it is still not permitted in my case, because in certain states, like mine, bulk beer transfers are not permitted. This is just fine for me, because I purchase the custom-produced wort, and then I monitor the fermentation myself, the way I prefer to handle it anyway.

All the best,

Rusty

[will]

Contact your TTB specialist. The regulations do not permit it, but you may be able to get a variance.

[Guest tom]

Why take such a short cut? Make it yourself. The only thing you could make is a ultra clean malt whiskey. Or vodka.

[porter]

because I purchase the custom-produced wort, and then I monitor the fermentation myself, the way I prefer to handle it anyway.

Now that's a thought I hadn't run across...... It isn't beer, doesn't have alchohol, so the TTB isn't interested in how or where we get it. It's just a raw product.

For a small startup it would be a way to get my rye and other blends without our having to set up for full grain brewing. We could get a high gravity wort directly off the mash tun and transport to do our own fermentation.

Leaves us to concentrate on more marketing, less on the low-end production.

Will look into that........

BUT...if the stat allows (Missouri does) wouldn't you simply purchase the fermented , high alchohol 'beer' from the brewery paying them the tax, then file the paperwork for the tax credit on your completed product? Isn't that the way it works when purchasing bad wine from a winery for a brandy?

[will]

Porter,

You're right, an un-fermented cereal mash is not regulated at all - kids can buy it, so can you, and any DSP is allowed to inoculate and ferment that stuff in his own equipment.

However, as PM noted in the original post, the Regulations (CFRs) don't allow beer to be transferred to a DSP for distilling material (whether the state allows it or not). On occasions where the TTB allows a variance to that regulation, the process is that the beer is transferred without payment of tax. Tax is paid once it leaves the DSP as spirit.

[Palmetto Coast]

Thanks for the suggestions.

BWF - I hadn't thought of that either. Sometimes the easiest things just elude us.

Will - Are you aware of any situations where a variance has been granted? Do you know any of the conditions?

Although I think I like the unfermented mash idea better. I'm looking at a rather small set-up as well Porter, this is a way for me to diversify my products without breaking the bank on equipment. I have spoken with a local brewery and they have been very receptive.

Are any of you others out there doing this?

Thanks for your help.

Todd

By the way, Monday we welcomed our newest future distiller, Pressley Kate. She was 6lbs. 5oz, and 19in. Now I just need to start this thing so I can leave it to the kids...

[delaware_phoenix]

I don't think there's a lot of equipment for creating your mash. Of course, you could buy brand new a bunch of specialized equipment, or you can buy used equipment from the pharmaceutical/food industry and there are liquidators of this stuff all around the country.

If you're buying GNS for any reason, the HDPE barrels it comes in — cut the top off — and you have instant 35-40 gallon food grade fermenters, for free.

Now you just need a mash pump.

Bet you could do it for under 5 grand.

Maybe some of the more serious folks here will tell me I've been nipping a bit too much of my own juice, and maybe they're right. But you won't know until you look at other equipment and make a list and see what it all costs.

[porter]

I don't think there's a lot of equipment for creating your mash. Of course, you could buy brand new a bunch of specialized equipment, or you can buy used equipment from the pharmaceutical/food industry and there are liquidators of this stuff all around the country.

If you're buying GNS for any reason, the HDPE barrels it comes in — cut the top off — and you have instant 35-40 gallon food grade fermenters, for free.

Now you just need a mash pump.

Bet you could do it for under 5 grand.

Maybe some of the more serious folks here will tell me I've been nipping a bit too much of my own juice, and maybe they're right. But you won't know until you look at other equipment and make a list and see what it all costs.

That's what we are gearing up. The food grade (had food product in them) barrels are only $15 around here. A good pump at around $500. It doesn't need to be anything too special as it won't be handling hot product, just some lumpy stuff at worst.