The beer industry can look back on a successful year. In 2023, beer production was 9.98 million hectoliters, matching the level of 2019 and slightly below the exceptional year of 2022. However, this is not a reason for breweries to rejoice: because inflation drives up costs. These will only be shipped to customers in limited quantities, Austrian Brewers Association President Karl Schwarz said on Monday.
As a reminder: During the pandemic years of 2020 and 2021, food and tourism mostly dried up due to the Corona pandemic. The following year, after operations ended, the industry experienced a real boom with the highest beer production since the 1990s. Although 2023 was overshadowed by inflation, Austrians still drank more of the hop-based drink. “Given the circumstances, we as an industry can actually be very complacent,” Schwarz said as he presented the annual figures. 8.55 million hectoliters were sold domestically, only 2.5 percent less than in 2022. 1.43 million hectoliters went overseas, down 6 percent from the previous year.
Despite the continued desire for beer, the industry is struggling with rising costs. This year they are “frozen at a high level at best”. Chances are these are significantly higher. Schwarz estimates that inflation could reach double-digit percentages for some raw materials. This – in addition to the high level of joint ventures – puts pressure on breweries' margins. And: “It's definitely noticeable in the price of beer.”
A related adjustment is already foreseeable: according to Statistics Austria, after an average increase in bottled beer prices of 9.4 percent last year, increases are now forming in the three to five percent range. According to the report, Brew Union and some private breweries are turning the price screws.
Schwarz is particularly concerned about price developments in catering businesses, which sometimes face high cost pressures that threaten their existence. “Last year, a pub specializing in beer had to close every day,” Schwarz said. The situation is particularly difficult in rural areas.
The association sees potential in non-alcoholic beer, the consumption of which has increased significantly recently. By 2023, 29 million liters of non-alcoholic beer will be brewed in this country, which is 3.3 percent of the total beer production. The aim is to raise this figure to around 5 percent in the coming years, according to the association's managing director, Florian Berger. He emphasized that the industry is constantly working to further enhance the enjoyment of non-alcoholic beer.
The industry expects inspiration from the new 0.33 liter reusable glass bottle that can be refilled up to 40 times, thus promoting circular economy in the sector. If Schwarz has his way, deposits for reusable bottles will have to be increased because the current “very low use” means that “reusable bottles are being returned less and less.” Negotiations with retailers are ongoing.
Again, industry representatives called for a reduction in the beer tax. This is especially important as the price of beer continues to rise. “It (the tax, note) is significantly higher compared to the neighboring countries of the Czech Republic and Germany (…) and raises the price of beer,” argued Schwarz.
