Hungary: Beer sales fall 7% in 2008, expected to further decline this year

Beer sales in Hungary fell by 7% year on year (y/y) to 7,181 hectolitres in 2008, and are expected to decline a further 5% in 2009, Interfax cited on April, 16 a statement of the Hungarian Beer Alliance.

"The economic crisis has reached Hungary's beer industry as well in 2008, as total sales fell 7% compared to 2007," the Alliance said. "For the time being, the Hungarian beer market will continue to shrink this year, by at least 5%, as worsening demand conditions are coupled with planned increases in VAT and excise taxes."

Hungarian beer producers - which produce local brands and licensed import brands, while also distributing imported specialty beers – sold 6,622 hectolitres of beer on the domestic market last year, down 10% y/y, while exports rose 73% y/y, albeit from a low base to a mere 559 hectolitres.

Of the companies' total sales, locally produced beer accounted for 7,049 hectolitres, down 6.6% y/y, while distributed import beers amounted to 132 hectolitres, down 15.4% y/y.

Despite lower sales last year, Hungarian breweries total costs increased by HUF3.3 bln compared to 2007, thanks to rising raw material and energy prices. Partly as a result, the industry's tax contributions to the state fell by 8% y/y to HUF57 bln.

Hungary's three largest brewery groups are Budapest-based Dreher, a unit of SABMiller; northern Hungary-based Borsodi, a unit of Anheuser-Busch InBev; and Heineken, which has two factories in western Hungary. The smallest major player on Hungary's brewery market is Pecsi Sorfozde, held by Austria's Ottakringer.

17 April, 2009