Tuesday, October 19, 2021
Price increases announced
Beer is becoming significantly more expensive
A lack of raw materials, higher energy costs and the pandemic: German breweries are turning the price screw in the face of diverse challenges. In the future, consumers will have to dig deeper into their pockets for a crate of beer in the supermarket or a glass of pilsner in a restaurant.
Bad news for millions of beer drinkers: Pils, export and wheat are expected to become more expensive soon. Three leading German breweries – the Radeberger Group, Krombacher and Veltins – want to noticeably increase their prices for gastronomy and retail next spring, as they confirmed.
Germany’s largest brewery group, Radeberger, justified the move with cost increases. “In addition to massive sales and earnings losses in the 18 months of the pandemic, all companies are now facing massive increases in costs for energy, logistics, empties, raw materials and supplies,” emphasized a company spokeswoman. These cost increases could no longer be compensated for by simply increasing efficiency. Therefore, the selling prices would have to be increased.
A Veltins spokesman pointed out that in the energy sector alone, costs have risen by over 150 percent in the past three years. “That can no longer be recovered,” he said. The planned price increase therefore applies to gastronomy as well as to retail. Krombacher pointed out that the last major price adjustment was three years ago.
According to estimates by the industry service “GetränkeNews”, the price increases announced in letters to customers are likely to make the glass of beer in the pub more expensive by between 30 and 50 cents. The price for the crate of beer is expected to rise by one euro in retail. For those in the know, it is foreseeable that other breweries will follow the example of Radeberger and Co. Experience has shown that after a price increase by the big brewers, the regional brewers of Kölsch, Weißbier and Hellem also dared to step out of the cover and followed suit on a broad front. “Beer will be more expensive across the board in spring 2022,” the experts forecast.
Beer as cheap as in D-Mark times
In the eyes of the brewers, there are good reasons for price increases. Since the beginning of the corona pandemic, there has been a significant drop in prices on the market. Because the dealers had used red pen offers for beer to lure customers into the shops even during the pandemic. The promotional price for the crate of Premium Pils is already back at the 10 euro threshold. This means that beer does not cost more than in the D-Mark era, when the crate was offered as a special offer for 19.99 marks.
In addition, people in Germany drank so little beer during the Corona crisis than ever since reunification. In the first half of the current year, domestic sales fell by almost 5 percent to a low of 3.3 billion liters, reported the Federal Statistical Office in the summer. Above all, the brewing industry lacked business in the catering trade and at the many major events. The only bright spot was the retail sale of bottled beer, from which only a few large breweries benefited.
However, beer lovers still have a grace period: Radeberger does not want to start raising prices until February. Retail prices are not even expected to rise until May. Krombacher and Veltins want to turn the price screw at the beginning of April. And there is still hope that some breweries will not go along with the wave of price increases in the end, given the tough competition.