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CASTLE MALTING NEWS in partnership with Polish
02 March, 2021

Brewing news New Zealand: Beer volume down 1.7% last year

New Zealand’s beer industry experienced a downturn in 2020 – the only alcohol sector to do so, according to the latest figures from Stats NZ, the Australian Brews News reported on March 1.

In Stats NZ’s report, Alcohol available for consumption report: Year ended December 2020, beer volume was down 1.7 per cent to 293-million litres.

While the dip is small, the amount of wine, spirits and spirit-based drinks available to consumers were all up, and cider remained steady.

The report showed while beer fell, the volume of wine rose 4.3 per cent to 113 million litres and spirits, including spirit-based drinks, rose 5.2 per cent to 89 million litres.

The equivalent total volume of pure alcohol in all alcoholic beverages for consumption rose 1.9 per cent.

The Executive Director of the New Zealand Brewers Association – which represents the country’s two largest breweries, DB and Lion – Dylan Firth, says the Covid-19 lockdowns and changes in the country’s Alert Levels had a particular impact on beer.

“One of the big things for beer was definitely to do with hospitality businesses being closed,” Firth says.

“Last year, obviously with lockdown in March in New Zealand and bars closed for subsequently nine to 10 weeks, and then a few different [stints of] Level 2 [restrictions] going on, we saw the consumption of beer in bars effectively completely stop.

“Hospitality sales of beer can make up about a third of your sales, and when you’re not able to do that, people change their drinking behaviours.

“Those who maybe only have one or two beers a week at the pub, often might not consume beer at home because it’s a less social environment, so they may not be buying beer from the supermarket – those sorts of thing probably affect the volumes overall.”

Where the beer sector did see some growth was in the no-alcohol and higher alcohol markets.

The no-alcohol beer market (up to 1.15 percent ABV) has been growing for the past five years, but in 2020 it doubled, with 1 million litres brewed in the 12 months to December.

While this is still the smallest segment of the beer market by far, Firth says he expects to continue to see it grow for a few years yet.

“People are more aware of just what they are drinking and choosing to drink lower or no alcohol beers, and the other side of that is there’s just more options on the market,” he says.

The amount of beer above 5 per cent ABV also increased for the seventh year in a row.

Firth says the DB and Lion experienced an uptick in demand for beers around 5 per cent during lockdown.

“In that five per cent area – your Heinekens and your Steinlagers – there was a bit of a shift back into those premium beers when there was lockdown, so people were searching for those trusted, known brands”.

He says craft beer sales have been pretty stagnant, and while some of the lift in the more than 5 per cent range could be related to people drinking more of the big hazy beers and IIPAs, consumers don’t buy them in bulk.

“They’re excellent, but people don’t go for volumes of that, they get one. So in terms of growth [in the more than 5 per cent sector], I don’t know how far that can go,” Firth says.

The biggest market, between 4.35-5 per cent ABV, saw a 10 million litre drop, but Firth believes that’s just reflecting drinkers moving to other parts of the beer market.

Stats NZ also reported a slight dip in beer exports, down to 24 million litres in 2020, compared with 26 million litres in 2019.

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