Cameroon: Beer prices up as bars adjust costs following government backlash

Since November 1, 2024, many bar owners in Cameroon have raised their prices, increasing the cost of beers and soft drinks by CFA50 to 100 FCFA. This decision has angered Luc Magloire Mbarga Atangana, Cameroon’s Minister of Commerce. His enforcement team sealed off several establishments on November 4 for illegally raising prices on products that require government approval for price changes, Business in Cameroon reported on November 5.

In a statement issued on November 4, Minister Mbarga Atangana reminded everyone that beer and soft drinks are indeed on the list of items that must go through a price approval process. He emphasized that the recent unilateral price increases by bar operators are invalid and without effect.

The tensions between the government and bar owners stem from a revision of terms between industry players, which led to the introduction of additional charges. Bar owners quickly passed these new costs onto consumers. However, a source from the Cameroon Alcohol Producers Association (CAPA) denied that such measures were in place across the association.

The Minister's November 4 statement highlighted recent changes in agreements between at least one brewery and its partners that have resulted in the price hikes seen since November 1. The statement indicated that bar owners acted in clear violation of regulations by raising beer and soft drink prices. The identities of the breweries involved were not disclosed, and attempts to gather more information from breweries on November 4 were unsuccessful.

In a statement released on November 5, Cameroon’s leading brewery, Boissons du Cameroun, which controls about 80% of the beer market, called for stability in pricing. They announced the introduction of handling and delivery fees starting November 1, 2024. The company expressed its commitment to work with the government and other stakeholders to ensure these new charges do not affect consumer prices. They argued that these adjustments aim to create fairness in the brewing industry amid rising costs of handling and pricing pressures in the market.

Since early 2022, industry players have sought government approval for a price increase following a previous adjustment in March 2019. The CAPA has advocated for a new price increase, citing the rising costs of imported raw materials and shipping after the pandemic and the onset of the Russia-Ukraine conflict.

In response to the Minister of Commerce's inaction, the National Union of Bars and Beverage Operators in Cameroon (Syndebarcam) announced a unilateral price increase of 50 to 100 FCFA, effective June 1, 2022. Once again, the Minister opposed this move. The CAPA then escalated its efforts, writing to Prime Minister Joseph Dion Ngute in December 2023. They requested a price increase due to rising fiscal pressures and increased energy and labor costs.

At a recent opening ceremony for a production line in Yaoundé, Stéphane Descazeaud, CEO of Boissons du Cameroun, voiced the brewers' need for a price increase, referring to the situation as a “tsunami of inflation.” He explained that to recover a minimum of CFA50 after taxes, beer prices would need to be raised by CFA100.

In a meeting with brewing industry stakeholders on May 16, 2024, Minister Mbarga Atangana again opposed price increases. However, according to Boissons du Cameroun’s recent statement, consumer prices have already risen for months. For instance, while the recommended price for a 65 cl beer is CFA650 FCFA, it is now hard to find it for less than CFA700 to CFA750. With this unofficial price hike tolerated by the Cameroonian administration, another official price increase would further strain consumers’ purchasing power.

05 November, 2024