E-Malt.com News article: 2546

Norway, Oslo: Norwegians rushed out to stock up on beer on April 23 after authorities ruled it was too cheap following an unprecedented price war in a nation used to some of the most expensive alcohol on earth, Reuters revealed on April 26. The price-cutting in Norway, whose sky-high alcohol taxes aim to curb drinking, has more than halved beer prices to 6.5 crowns ($1) for a 0.33 liter bottle in recent weeks. The price is lower than the 6.7 crowns tax, meaning retailers are selling at a loss.

"The current price on beer is in breach of the alcohol law," Bjorn-Inge Larsen, director of the health directory, told a news conference, ordering retailers to boost prices or be stripped of their licenses to sell alcohol. He said he expected retailers to comply soon by lifting prices. The ruling triggered a flood of beer buying. "It's time for hoarding," said Thomas Stroem as he carried three cases of beer out of a grocery store in Oslo. "It might take a long time before we get cheap beer again."

Non-European Union Norway's taxes on alcohol are the highest in Europe, prompting thirsty shoppers to flock to EU neighbors Sweden and Denmark to stock up on beer, wine and liquor. Many Norwegians brew beer at home or make moonshine.

Retailers have axed prices in recent weeks to stop people buying abroad. They are also worried about losing out to German discount chain Lidl, which has opened cut-price outlets in Finland and Sweden and plans stores in Norway. According to the Norwegian brewery lobby group, Norway's beer taxes per liter are more than double those in Sweden and five times the rate in Denmark. "Something has to be done about taxes, otherwise no one is going to buy beer in Norway at all," said Helge Hasselgaard, spokesman for the Norwegian Brewery Association.

Norwegians drink relatively small amounts of beer, about 50 liters per person per year. Beer is sold in supermarkets but stronger drink, like wine and liquor, are sold from state outlets as part of a system meant to protect public health. Norway does not need extra revenues from taxes -- it is the world's third biggest crude exporter and is swamped by cash from oil. But it has a powerful teetotal lobby -- Prime Minister Kjell Magne Bondevik does not drink. ($1=6.942 Norwegian Crown)


28 April, 2004