9% local beer market decline for the first five months of the year

The Romanian beer market reports a 9% decrease in the first five months of 2023 compared to the same period of the previous year. The results are part of the decreasing trend starting last year and continuing to accelerate in 2022.

This market fall is attributed to a series of factors. Among the most important are the decline in purchasing power and the difficult economic context, given the acceleration of inflation rates and raw material prices increase. Another factor in the decline is the alarming increase in production costs, which continues this year, even if certain categories of costs, such as energy, have stabilized. The below-average temperatures of the normal early summer period also contributed to these results, beer being a drink whose consumption is strongly influenced by the weather.

“2023 is extremely challenging for Romanian brewers. Their efforts are concentrated on keeping the activity at a stable level, also considering the erosion of Romanians’ purchasing power in a hyperinflationary context. The fiscal predictability is essential for an honest local beer sector to continue to function in this market”, says Julia Leferman, general director of the Brewers of Romania Association.

Starting from August 1, 2022, the basic value of the beer excise was increased by 20%, and starting from January 1, 2023, another 6% were added, up to the value of 4.20 lei/hl/ °Plato. In this context, the budget adjustment measures that are being discussed these days at the Government level risk putting excessive pressure on the market balance.

In Romania, 97% of the production and marketing processes specific to the beer industry are local, and 50% of the ingredients used in the beer manufacturing process come from Romanian agriculture.

The beer sector directly and indirectly supports over 60,000 jobs, and data from the Romanian Brewers Association show that 1 job in beer production generates 11 other jobs across the entire value chain: 2 in agriculture, 3 in retail, almost 3 in the hospitality sector and 3 for suppliers.

Moreover, the beer category brings 700 million euros added value to the economy annually, and the sector is recognized for its honest fiscal behavior, with zero tax evasion in the production chain and annual contributions to the state budget of 530 million euros: “The beer industry is a national one, the main ingredients come from Romania, the beer is made in factories in the country, and the products are also packaged locally. The beer sector represents an engine for the country’s economy, having an important impact on jobs and state budget revenues,” adds Julia Leferman.