Is it Trendy Tea or is it Alcohol?

Emily Fredrix, AP Retail Writer, On Wednesday July 14, 2010, 9:30 am EDT NEW YORK (AP) -- It's a fermented, pungent tea, but it's the alcohol that can lurk inside of kombucha that's causing a stink.

Regulators and retailers are concerned that the ancient and trendy tea may need to be regulated as an alcoholic drink. That's because some bottles have more than 0.5 percent alcohol -- the legal limit for a drink not to be considered alcoholic.

The drink dates back thousands of years and across cultures, though its actual country of origin is unclear. But it has gained popularity in the past few years in the U.S., partly because of claimed health benefits, though there's little science behind them. And it doesn't hurt when stars like Lindsay Lohan are photographed drinking kombucha.

Since last month, the government has been testing kombucha to determine if it should be labeled like beer or wine. Distributors and retailers like Whole Foods Inc. have removed the most popular form, raw kombucha, from stores, saying they won't restock until they know more.

That's upsetting fans, who enjoy the sweet-but-sour taste and shell out more than $3 for a bottle. They're scouring stores, starting Facebook groups such as "Dude, where's my kombucha?" and lamenting online.

Anne Sommer misses drinking kombucha each day at 5 p.m., while her husband had wine. She can't find any at home on Bainbridge Island, Wash., about 30 minutes outside of Seattle and misses her "Booch."

"I've considered taking up wine. I just don't like how that feels," she said. "I just drink water and count the days."

Kombucha (pronounced com-BOOCH-a or com-BOOK-a) contains live bacteria and yeast, similar to yogurt. Many fans make it at home by acquiring a kombucha "mother," a cloudy mass of bacteria and yeast from another batch. But most prefer to buy it for convenience. Pasteurized versions -- where the yeast and bacteria are heated, much like milk -- are still for sale because the process kills the yeast, which make the alcohol. But fans tend to prefer the raw version.

Kombucha makers say it leaves production with almost no alcohol. But alcohol can develop over time in unpasteurized versions because the yeast is still alive, converting sugars to alcohol. The more sugar a drink has, the more alcohol can ferment. So each recipe might be different.

Gerry Khermouch, editor of Beverage Business Insights, estimates some kombucha brands might have 2 to 3 percent alcohol, based on reports from producers doing independent testing. Regular beer has about 4 to 5 percent alcohol.

Sales have been doubling each year for at least the past four years and are now worth more than $150 million a year at retail, according to Beverage Business Insights. That's still barely a drop compared to the $100 billion-a-year U.S. drinks market.

Big brands like Celestial Seasonings and Honest Tea have launched their own raw kombucha brands. Both have taken their products off shelves and are working on new versions.

Some fans aren't waiting. Macoe Swett drove 80 miles round-trip to snag 20 bottles based on a Facebook tip. The 37-year-old graphic designer will cut her thrice-weekly habit to once a week.

G.T. Dave, CEO of the company that makes category leaders GT's Kombucha and Synergy, said the products should return in weeks. His company plans to resume production with a new version that will keep alcohol levels under the limit, though he declined to say how the company would do that.

"We're hoping this month, but nothing is definitive," he said.

The federal Alcohol and Tobacco Tax and Trade Bureau, which is testing samples of kombucha brands to determine how it should be labeled, said each brand will be treated differently, depending on its alcohol content. It's not clear how long the investigation will take because regulators don't know how many companies produce kombucha, spokesman Art Resnick said.

Neither Austin, Texas-based Whole Foods or United Natural Foods, kombucha's largest distributor, returned calls seeking comment.

Producers are weighing their options. They can change their formula or production methods to lessen the alcohol, pasteurize their drinks, or market their drinks as alcohol. But that would mean taxes and label approval and dealing with a maze of government regulations.

Katalyst Kombucha in Greenfield, Mass., will buy new equipment for $50,000 -- 10 percent of the sales he hoped to do this year -- to remove alcohol without heat, meaning the drink can remain unpasteurized. But owner Will Savitri doesn't know what this means for business.

"I think we're going to get through this one and hopefully on the other side it's going to be a little less tumultuous," he said.

Elaine Marshall wants her favorite drink back. The 41-year-old mother in Long Beach, Calif., relied on her morning kombucha for energy. But if there's too much alcohol, she'll think again.

"I'm going to be a little bit leery of drinking that with my breakfast."

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