E-Malt.com News article: New Zealand: A 3 per cent beer price increase to be passed to customers

The price of beer will increase by nearly 3 per cent as New Zealand's biggest brewers try to recoup costs in a flagging market, reported businessday, March 27.

Overseas-owned breweries Lion, DB and Independent Breweries are all hiking beer prices by the end of April.

DB spokesman Simon Smith said it would increase tap and packaged beer prices by 2.8 per cent from April 13.

"We have kept this price rise to a minimum, despite tough market conditions and increased operating costs," Smith said.

Lion national sales director Danny Phillips said that from March 30, Lion was increasing its price for all pack beer by 2.8 per cent.

However, Pak 'n' Save supermarket owner Foodstuffs marketing manager Katherine Klouwens said the three breweries were putting some prices up.

Countdown spokeswoman Kate Porter said it would pass price increases on to customers.

In March 2012, DB bumped up its tap-beer price by 1 per cent. Lion increased its prices by 1.5 per cent a week later.

Lion, owned by Japanese beverage giant Kirin, produces beers including Stella Artois, Steinlager, Speights and the Mac's range.

DB, owned by Dutch brewer Heineken, produces Heineken, Double Brown, Tui and Export Gold while Independent Brewery, owned by Japanese brewer Asahi, produces Haagen, NZ Pure and the Boundary Road range.

A 2.8 per cent increase would mean a 12 pack of Heineken sold at Countdown increases from NZ$26.49 to NZ$27.23 while a pint, which costs about NZ$10.90 at a bar, would increase to NZ$11.20.

For the last three months of December, 2013, Statistics New Zealand figures showed a dozen bottles of beer was priced at an average of NZ$20.45.

Phillips said the price hike was due to operating costs to produce pack beer increasing significantly over the past few years.

Lion's income for the year to September 30 was down 8 per cent from NZ$611 million in 2013 to NZ$564 mln. Net profit for the year was down $11m to $44 mln.

Lion New Zealand spokeswoman Sara Tucker said a continuing downwards trend of the alcohol market in New Zealand had impacted Lion's income last year.

The price and volume of the total beer market declined last year, she said.

Moa chief executive Geoff Ross said the craft brewer had no plans to increase beer prices.

"We are in the craft segment of beer which is where consumers understand the value of quality and are happy to pay for it - so we haven't had to be in discount mode over previous years like the mainstream foreign owned beers," Ross said.

Statistics New Zealand figures show last year the total volume of alcoholic beverage available for consumption fell 2 per cent, to 457 million litres and the volume of beer available fell 2.3 per cent or 6.5 million litres, to 282 million litres compared with 2013.

In 1996, beer made up 81 per cent of total alcoholic beverage available for consumption.

Last year beer made up just 62 per cent, unchanged from 2013.

Hospitality New Zealand chief executive Bruce Robertson said he would expect most bars and pubs to pass the price increases onto consumers.


27 March, 2015