Czech Republics beer sector in crisis

Czech Republic's beer sector in crisis

Brewers in the Czech Republic are facing their worst crisis for 20 years, according to the country's beer union.

Tax increases on beer and Government austerity measures caused beer consumption in the Czech Republic to fall by 12% in first half of this year. It is expected to drop more steeply in the second half, according to the executive director of the country’ s Breweries' Association, Jan Vesely.

The Association warned today (27 October) that brewers face the worst crisis since at least 1989.

Brewers are being squeezed between lower consumption and higher costs. The second biggest player in the country, Pivovary Staropramen, has decided to raise the wholesale price of its draught beer by 4.5% per half-litre as of next week. “This is because our costs regarding barley as well as energy are constantly rising,” said group spokesperson Pavel Barvík.

There are reports that Czech breweries have begun experimenting with beers at lower alcohol levels in order to reduce excise tax bills.