Ukraine & Belarus: Obolon forced to increase beer prices by 49% to sell it in Belarus

Obolon, one of Ukraine’s leading brewers, will increase prices of its plastic-bottled beer on the Belarusian market by 49% to resume produce supplies to the country, Interfax-Ukraine reported on February, 3.

Agreement on this was achieved after talks with Belarusian food regulator Belgospischeprom, and stipulated in a bilateral contract.

"The signing of an agreement with Belarus is a forced step. We had to do everything possible not to lose the market completely," Vice President on Obolon Corporation's development Victoria Alimova said, commenting on the outcome of the talks.

Obolon noted that initially the Belarusian side proposed prices be increased by 65%.

The Ukrainian company said that it would develop a license program with OJSC Brestskoye Pivo on the production of beer under the Desant trademark started in the spring of 2010.

According to the company, beer supplies to Belarus have not resumed, as official importers have just applied documents to get licenses.

According to Obolon's estimations, taking into account the rise in price, Ukrainian beer will lose out in competition on the Belarusian market and its sales will drop significantly.

The Ukrainian company said that it still considers the introduction of the licensing of Ukrainian beer imports to be a discriminatory method of market regulation.

04 February, 2011