Beer is getting more expensive – also in Munich breweries: ‘It’s affecting everyone at the moment’
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Munich – Of course, it’s no secret: in Bavaria, beer is held in especially high esteem – it’s not for nothing that “liquid bread” is still often referred to as a staple food in the Free State. But the price hike in the food sector doesn’t stop here either: beer is getting more expensive too!
This trend, which was not very pleasant for consumers, was also evident in The Bavarian Brewers Association at its annual press conference in February a favour. From malts and hops, to bottles and labels, to crown caps: Bavarian beer production costs have recently gone up in almost all regions.
Although beer sales in Bavaria were again slightly above the pre-corona level last year, one should not immediately assume that the economic situation in the industry is good. Because of rising prices, breweries are under increasing pressure, said Georg Schneider, president of the Brewers Association. Therefore, he considers the rise in beer prices to be inevitable.
“Since February 2022 we have seen a cost explosion in almost all regions,” Schneider said. “The brewing industry is suffering across the board from significant increases in procurement costs, mainly for energy, but also for raw materials, bottles, carton boxes, and so on.”
More expensive beer? Order from Munich breweries
But is beer really getting more expensive everywhere? Ordering from AZ large breweries in Munich.
In the Hofbräu, for example, an average four percent price increase is planned for the first quarter of 2023, explains a brewery spokesperson when asked by AZ. For a brewery, the move is inevitable. “Increasing costs in many areas are affecting all breweries,” says the spokesperson.
Price increase: Boxes of beer have cost one euro more since February
But beer didn’t just become more expensive for the really big companies—Giesinger Bräu, a medium-sized brewery in Munich, had already had to adjust its prices. “Unfortunately, we also had to increase prices slightly, otherwise we wouldn’t be able to operate economically,” says Stephen Marks, founder and managing director of Giesinger Bräu, AZ. In concrete terms, this means that the price per bottle has gone up by five cents since February 1st. “This means that a box of Geisinger beer has become one euro more expensive for the consumer,” Marks says.
The Giesinger Bräu example shows that small and medium breweries in particular struggle with increasing production costs. For Marks “a really big challenge” because almost all the suppliers and utilities have raised their prices significantly. However, he wants to keep the consequences for the customer as low as possible. “We don’t want and can’t pass on these 1:1 increases, because beer should still be affordable.”
© Sigi Müller
by Sigi Mueller
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Anheuser-Busch InBev group of companies, which includes Spaten and lonebrow I heard a little more cloudy. For antitrust law reasons, no statement can be made about price developments, she says when asked by AZ.
However, increased production costs will also be noticeable at AB InBev, a company spokesperson explains. “Of course, we are also burdened by the skyrocketing costs of brewing and distributing high-quality beers like Spaten and Löwenbräu.” Not only did electricity and gas costs go up, but prices for “fermenting malt, hops and packaging materials such as glass and new bottle caps skyrocketed”.
A repeated request from AZ to the Augustiner brewery and the Paulaner brewery (to which Hacker-Pschorr is also affiliated) has unfortunately remained unanswered so far.
Brewers Association President: “It’s affecting all breweries right now”
But here, too, it can be assumed that prices will go up (sooner or later). “It affects all breweries right now,” Walter Koenig, general manager of the Bavarian Brewers Association, says in an interview with AZ. “Everyone is doing the math and thinking about how this high cost burden can add to the sales prices of specialty beer.”
However, there is no one-stop solution for the industry. Each brewery decides and calculates for itself, but each brewery calculates differently. Koenig explains this with an example: “Breweries with lower productivity (hcl per employee) have higher personnel costs and have to calculate differently accordingly.” However, what is the same for all breweries: They all have to deal with the same cost increases when using malts and hops.
No simultaneous price increase by breweries
“Breweries can’t absorb the increase in production costs. Even if they wanted to, they couldn’t,” Koenig says. The result: “The burden of enormous cost, one way or another, has to be passed on.” However, according to Koenig, there will not be a simultaneous price adjustment for all breweries. The reason for this is the contracts, for example for raw materials, auxiliaries or energy, that each brewery has. “Just as these contracts accumulate in succession, the new contracts, which come with much higher costs, will also raise production costs,” Koenig says.
According to him, price adjustments made by breweries have less impact on the retail business than they do on the restaurant business. “The cost increases, which the landlord or operator of a restaurant stomach must pass on, of course make stomach beer more expensive than retail.”
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