Australia: Beer prices could spike this Christmas as production costs skyrocket

Australia’s beer drinkers could be paying up to A$10 per case extra this Christmas, as production costs skyrocket, news.com.au reported on November 28.

Queensland University of Technology marketing professor Gary Mortimer said three compounding factors were causing the spike in beer prices.

“One is the impact to barley crops across the eastern seaboard inundated by flooding and high rainfall,” he told NCA NewsWire.

“That means there’s less raw materials to move into production.

“The second reason is the increased production costs, including higher prices for water, electricity and fuel for logistics.

“And finally the alcohol excess applied every six months, which is currently 3.8 per cent.

“It’s a triple whammy.”

Professor Mortimer said beer drinkers would paying A$5 to A$10 extra per case because of the increased costs.

He suggested those still wanting to buy beer for Christmas should consider mid-strength or even alcohol-free options because the alcohol excess is applied differently and may reduce costs slightly.

And it’s not just beer facing price hikes, with the cost of fresh fruit and vegetables also being impacted by recent weather conditions and flooding.

Professor Mortimer said while fresh fruit and vegetable should be more readily available in the lead-up to Christmas, other festive favourites like stone fruits might be harder to source.

“It’s going a tough Christmas for everyone,” he said.

“It’s not just the logistic costs of moving items around the country, but we’ve got a lack of pickers. We don’t have international labour around the country.

But there’s some hope for shoppers, with Professor Mortimer forecasting food prices to stabilise in late 2023.

“It’s a long journey,” he said

“We’ll hopefully stabilise with 6-8 per cent inflation across the board.

“Hopefully, the war in Ukraine will resolve itself, but there will be a lag in that before we see fuel prices fall.

“Plus when international backpackers and students start to flood back into the country, we’ll start to see food delivery costs improve because of the increased workforce.”

28 November, 2022