E-Malt.com News article: 1921

Small Czech brewers will target the large Polish market next year to take advantage of the fact that it will be truly open to them for the first time in more than a decade, Prague Business Journal reported on December 8. Individual brewers and the Czech Association of Small Independent Breweries (CSMNP) have already drawn up plans to penetrate Poland once the country drops existing prohibitive import barriers for Czech beer. The Polish government currently only allows 60,000 hectoliters of Czech beer to be imported a year free of customs duty. Above that limit a duty of 21 percent of the imported price of the beer is levied. Jan Vesely, the head of the Czech Association of Breweries and Malt Houses (CSPAS) and president of the European Brewing Convention, said the duty, imposed in 1992, increased the price of Czech beer so much that it couldn't compete on the Polish market.

Czech brewers exported 2 million hectoliters of beer in 2002, 145,000 hectoliters of them to Poland, or about 7 percent of total exports. Poland currently ranks as the No. 6 export market for Czech beer behind Germany, Slovakia, England, the U.S. and Russia.

No obstacles should prevent free trade in beer and the Polish market will open up for Czech brewers once both countries join the European Union (EU) in May, Vesely added. The Polish market is especially attractive for Czech brewers because it's close and exporting is fairly easy. "Beer is gradually pushing out spirits [in Poland], following the fashion in Western Europe," Vesely added.

The CSMNP is already preparing an awareness and marketing campaign in Poland, and by next April, beer drinkers in several Polish towns should be getting what could be their first taste of the wares of small Czech independent brewers, said Jiri Fusek, the head of the CSMNP and president of European Association of Small Independent Breweries (EASIB). The association was created in August to promote the interests of small breweries in an enlarged Europe.

Fusek said more details of the promotions would be released in January. The Polish beer market is currently dominated by "euro beer," with a standard taste produced by the big brewing multinationals, he added. "I think we have a pretty good chance on the Polish market as we can widen the range of flavors," Fusek said. "I think the Poles will be excited about that."

Fusek runs his own brewery, Pivovar Cerna Hora, which has a capacity of 200,000 hectoliters. "Right now we produce an average of 160,000 hectoliters of beer per year but [our] capacity allows us to increase production if our expectations for exports to Poland work out." Fusek said. He'd like to sell about 10,000 hectoliters of Cerna Hora beer in Poland next year.

Frantisek Meduna, head of the marketing department at Pivovar Nachod brewery, said that the brewer is networking in Poland and renewing contacts from the pre-quota and duty era of the early 1990s. Nachod is almost on the border with Poland.

Meduna said the brewery expects its special selection of stronger beers to be such a hit with Poles that they'll day-trip across the border and load up on it. At the moment, individual Poles are not allowed to take more than one liter of beer back home per trip, but that will change after EU entry to 110 liters per person, Meduna said. "We want to penetrate Poland through these shoppers," Meduna said. "And as soon as Poles are aware of our beers we can start transporting them there."

Pivovar Nachod has a production capacity of 200,000 hectoliters of beer per year and produces about 140,000 hectoliters. Meduna didn't want to guess how much beer Nachod might eventually be able to sell to the Poles.

The Czech brewer Drinks Union wants to sell its beer in Poland on supermarket shelves. "In Poland, the consumption of draught beer is very low," said Milos Kuba, the brewer's export director. "So in the early stages, we'll probably focus on supermarkets…We're now working intensively on figuring out our strategy for getting into Poland."

Kuba said Zlatopramen, its flagship beer, would be its main export to Poland. Breweries within the group include Pivovar Kutna Hora, Zlatopramen, Louny and Krasne Brezno. Drinks Union is ready to increase its capacity if exports to Poland require this, but Kuba didn't want to give any precise figures. Drinks Union is already the fourth biggest Czech exporter of beer and this year became the third largest beer importer in Germany, he added.

CSPAS' Vesely said Czech beer has a strong chance of success in Poland. Higher exports to Poland should increase overall Czech beer exports by at least 3 percentage points next year, he said.

Some are skeptical about Czech success in Poland. Jaromir Bulko, a native Pole and director of Mestansky Pivovar Nova Paka, said he believed the big multinationals already present would find ways of preventing Czech brewers from making inroads into their market.

"I've renewed one of my old contacts in Poland, and he is now watching closely developments on the market" to come up with a strategy for taking on the multinationals, Bulko said. Exporting bottled beer is the easiest export route into Poland, he said. "In Poland, pubs are a family business and you have to go to each pub and contact each individual owner… Establishing [yourself] in Polish pubs is no fun."



12 December, 2003