Beer is no longer as lucrative as it used to be.
Americans Are Drinking Less Brew, and the Region Is Persistent Losing Market Share to Spirits, Beer companies, faced with rising operating costs in areas such as packaging and transportation, have increased prices and seen bigger profits as consumers hike the bill.
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The cost of beer purchased at retail locations such as grocery stores increased by 5.9% for the 12 months to April 2023 compared to the previous year. statistics From the Bureau of Labor Statistics. The rate tops overall inflation of 4.9% for the same period.
Since 2000, retail beer consumption at home has increased by more than 72%. The cost of beer has gone up even further for out-of-home drinkers, jumping 102% during that time.
While beer lovers have felt inflation in their wallets, price increases last year helped drive a strong performance for some of the world’s biggest beer makers.
in his latest quarterly earnings reports, Anheuser-Busch InBevThe world’s largest brewer and maker of Bud Light, reported profit jump Increasing prices and prompting consumers to spend more on premium offerings. As a result, the brewing giant saw its core profit rise 13.6% year over year to $4.76 billion. At the same time, beer sales grew only 0.4% compared to a year ago.
Other beer makers such as Molson Coors and Heineken are also reporting better-than-expected profits as consumers absorb higher prices.
Daniel Kosmal, vice president of research at the Beer Institute, said beer is still a staple product in many American households and remains an “affordable luxury.” She notes that other beverage categories, such as juice and carbonated drinks, have seen double-digit increases far outpacing the overall rate of inflation.
Meanwhile, distilled liquor and liquor drinkers are doing better amid the country’s rising inflation. Prices for both the categories have seen a marginal year-on-year increase of around 1% to 2.5%.