Ireland: Budweiser monitoring prices and costs as rival Heineken announces price hike

Budweiser is monitoring its prices and costs, a week after rival brewer Heineken announced it was raising the price of beer, Independent.ie reported on November 13.

The brewing giant said grain, energy and glass prices have created significant cost pressures, with furnaces used in bottle production requiring huge energy resources.

“We are also facing increases in waste packaging and other taxes,” said a spokeswoman for the Budweiser Brewing Group.

“We evaluate our input costs and make necessary price adjustments on an ongoing basis while driving efficiencies in our business through sustainability and other initiatives.”

She said energy and grain prices have increased significantly over the past year.

“We are unwilling to compromise on providing the highest quality products to our customers,” she added.

Last week, Heineken cited similar pressures when it told publicans a 9pc increase in wholesale draught prices will come into effect next month.

It said malt prices had increased by 120pc, while diesel was up 67pc.

Global food commodity prices are up 2pc compared with October last year, according to the UN Food and Agriculture Organisation data. Cereal prices are up 11pc.

CSO consumer price index (CPI) figures show general inflation hit 9.2pc in Ireland in the year to last month, but the cost of beer and spirits rose by more than 12pc in the same period.

This compares with a 4.3pc increase in the price of beer in a bar over the past 12 months, according to the CPI.

Industry sources said publicans expect to see further price increases from other brewers and suppliers in the coming months.

Diageo and C&C did not respond last week to queries about pricing and costs.

Richmond, a distributor for international brands including Peroni and Kopparberg in Ireland, told Irish hospitality businesses last week that it is committed to maintaining prices across its draught portfolio until June 1.

Vintners’ Federation of Ireland (VFI) president Paul Moynihan said many publicans will be unable to absorb the Heineken increases because of other inflation pressures.

He believes he will be among those forced to pass on at least part of the increase to customers, but he is still trying to work out the effect on his business.

“Before this increase, we felt that if we got through winter and spring and made a few quid next summer, all would be well and good,” he added.

“We build up reserves over Christmas to get through to St Patrick’s Day, so the increase makes it more difficult.”

15 November, 2022