20.08.2024
Breweries
Study
Here’s how the price of your beer has changed over time
Beer is no longer as profitable as it used to be.
- Inflation is hitting the beer industry hard as brewers struggle with rising packaging and transportation costs
- Beer producers such as Anheuser-Busch and Molson Coors have raised prices on many of their popular beers.
- In the 12 months to April 2023, beer prices increased by 5.9%, and since 2000, by 72%.
People are drinking less beer, and the sector is steadily losing market share to spirits. Beer companies, faced with rising operating costs in areas such as packaging and transportation, have raised prices and earned higher profits, and consumers are footing the bill.
According to the Bureau of Labor Statistics, in the 12 months to April 2023, the price of beer purchased at retail outlets such as grocery stores increased by 5.9% year-on-year. This figure exceeded the overall inflation rate of 4.9% over the same period.
Since 2000, retail consumption of beer at home has increased by more than 72%. The cost of beer for people drinking away from home has risen even more, jumping by 102% during this time.
While beer lovers have felt the inflation on their wallets, the price increases over the past year have helped some of the world’s largest beer producers achieve strong performance.
In its most recent quarterly earnings report, Anheuser-Busch InBev, the world’s largest brewer and producer of Bud Light, reported a sharp rise in profits due to higher prices and consumers spending more on premium products. As a result, the brewing giant’s core profit increased by 13.6% year-on-year to $4.76 billion. At the same time, beer sales grew by only 0.4% year-on-year.
Other beer producers, such as Molson Coors and Heineken, are also reporting better-than-expected profits as consumers absorb higher prices.
Danelle Kosmal, vice president of research at the Beer Institute, says beer is still a staple in many American households and remains an “affordable luxury.” She notes that other beverage categories, such as juices and sodas, have seen double-digit price increases, well above the overall inflation rate.
Meanwhile, consumers of spirits and wine are doing much better amid the country’s soaring inflation. Prices for both categories experienced only moderate growth, ranging from 1% to 2.5% year-on-year.