New Zeeland: Breweries plan beer price rise

New Zealand's two largest breweries are planning price rises from July 1, New Zeeland Herald reported May 2.

Lion Nathan and DB Breweries are citing higher production costs for an increase in the price of beer, but neither of the brewing giants is ready to say by how much.

Lion Nathan was first to announce its price rise.

Managing director Peter Kean said: "Over the past 12 months we've sustained increased costs right across our manufacturing and distribution activities, including higher aluminium, glass, sugar and fuel prices.

"We cannot continue to absorb higher production costs any longer."

The recent increase in road-user charges was the latest cost.

DB Breweries' managing director Brian Blake said his company would also increase prices when the annual CPI-related excise tax was increased on July 1.

"That's traditionally when the breweries look at their increases in costs," Mr Blake said.

DB had yet to determine the level of its price increase.

"We haven't done the detailed calculations at this stage. But there have been significant raw material increases over the past 12 months and they need to be recovered."

Lion's corporate affairs director, Liz Read, said the company would inform the retail trade of new prices in about two weeks.

The excise duty on alcohol is adjusted in line with the CPI, which was up 2.5 per cent for the year to March.

"The beer market is still extremely competitive, so we will recover our costs and only that", Mr Blake said.

Independent Liquor, a major player in the ready-to-drink market, said it had "no plans at this stage" to increase prices.

CEO Doug McKay, who started work with the company yesterday, said it hadn't planned any price increases. "I need to take a bit of time to review that, I guess."

Consumers' Institute of New Zealand chief executive Sue Chetwin said the positive thing for consumers was that price wars between supermarkets would help keep wholesale beer and wine prices down.