More beer is being consumed at home

More beer is being drank at home. Although sales in the beer industry have been hit hard by the closure of pubs, restaurants and clubs during the corona lockdown, a ray of hope is shining through: at least people are still buying beer to drink at home.

Thus, German beer drinkers purchased around 38.6 litres of beer and beer mixed beverages per capita from January to July 2020, amounting to €52.00 each, according to a study by Nielsen, a measurement and data analysis company. When we run the calculations, that’s almost eight bottles more than in the first half of 2019. The Nielsen beverage expert Marcus Strobl has observed that this is the biggest rise in sales of beer and beer mixed beverages in the last 15 years. One reason for this may be the closing of restaurants and pubs during the corona lockdown. Instead of going to the pub, people mainly preferred to drink beer at home.

According to the trade magazine Beer Business Daily, in this year’s market the USA has now experienced a shortfall of over 10 billion beverage cans due to the increase in at-home beer consumption. This is because big beverage manufacturers such as Pepsi, Coke, Anheuser-Busch and Molson Coors had already secured their share of drinks cans before the bottleneck via supply contracts. Smaller breweries were even, in some cases, forced to purchase empty beer cans from other breweries that had not yet filled them with their own beer, to reshape them and repackage them in their own design.

THE BEER CAN IS PERENNIALLY POPULAR

The huge increase in can sales has been attributed not only to stockpiling pallets of cans of beer but also to a trend that was picked up on in 2019, according to industry experts in the USA. Lester Jones, Chief Economist for the American National Beer Wholesalers’ Association, stated to the Washington Post in October 2020 that 60% of beer brands were already being sold in cans by the end of 2019. On the contrary, only 30% of the amber nectar is sold in bottles and just 10% of beers are sold to customers on tap via pumps in gastronomy and pubs.

Over the course of many years, craft beer manufacturers in particular preferred to fill their wares into bottles. They were perceived to be elegant and were offered, preferentially, by upmarket restaurants and beverage markets. With the growth of the craft beer segment and the increasing diversity in retail and in beverage markets, beer cans have become more popular overall, according to the experts. They are easier to stack and transport and an easily be taken everywhere - to the beach, a sporting event or a gig. In addition, beer cans are cheaper for breweries to acquire and are lighter in terms of weight.


THE BEER INDUSTRY SUFFERS

As with so many things this year, International Beer Day on 7th August also fell victim to the corona virus in 2020, and the world-famous Oktoberfest followed suit. As with other branches of industry, there is no reason to celebrate in the beer industry either. Since the outbreak of the COVID-19 pandemic, breweries around the globe are showing huge losses. As restaurants and pubs closed, sales dropped by 40% in some instances.

In the USA, trade associations expect that over half a million jobs in the beer industry will be lost by the end of 2020. In Germany, breweries have experienced the poorest profit since the current statistical method was introduced in 1993, according to the German Federal Statistical Office. In the first six months of 2020, beer manufacturers only sold 4.3 billion litres of beer. That’s 300 million litres, or 6.6%, less than the same period the previous year.

MORE ALCOHOL-FREE BEER

We need to bear in mind that the beer industry was already doing badly before the corona crisis. The reason for the drop in beer consumption, according to industry stakeholders, lies in global health trends and stricter blood alcohol limits for driving. However, although beer sales figures dropped, a rise was seen in the consumption of alcohol-free beer, which is currently ranking at number three in the beer charts with a market share of 7%. Marcus Strobl thinks that this trend is no flash in the pan; it’s a curve that is developing over the long-term and is here to stay: “Since 2007, alcohol-free beer is the only type of beer whose sales have grown constantly. While the market share for 2007 had just hit 2.7%, it’s now already almost 7%.”