Beer market drops 5 percent in Q1 on low purchasing power

After the local beer market stabilized in 2011, local beer consumption has gone down by 5 percent in Q1 2012 compared to the similar period of the previous year, according to the Brewers of Romania Association.

Compared to the results of the first quarter of 2008, a reference year in terms of beer consumption, the decrease over the first three months of 2012 is “dramatic”, reaching a historical percentage of 23 percent, according to the same source.

“The decrease in the consumption of beer during the first quarter of 2012 was especially influenced by the cold weather and heavy snow from January – February that made people stop drinking beer. That factor was added to an already unfavorable context, the fact that for Romanians every RON counts, which makes a popular product as beer, to be less accessible. If an European citizen has to work on average around 8 minutes to afford a beer, a Romanian has to work half an hour for one,” said Constantin Bratu, general director of the Brewers of Romania Association.

The latest data related to the market evolution confirm a negative trend which has been marking the Romanian brewing industry since 2008, generating unfavorable overall results. Strongly affected by the economic crisis which triggered a major decrease of the Romanians’ purchasing power, the brewing market faced a significant consumption contraction over the past few years, the cumulated decrease in 2009 and 2010 reaching 16 percent. The stabilization signs that were detected during 2011, when the market was flat, were replaced by renewed decline in the first three months of this year.

The market drop also means the number of direct and indirect jobs generated by the brewing industry in the country’s economy has gone down by 21 percent, from 96,400 to 76,000.

The members of the Brewers of Romania Association are Bergenbier, Heineken Romania, Romaqua Group, United Romanian Breweries, Ursus Breweries and, as of last year, Clinica de Bere, a micro-brewery in Timisoara. The group also includes Soufflet MaltRomaniaand the Association of Hops Producers fromRomania.

The revenues to the state budget from the collection of VAT and other taxes, such as health insurances, social security contributions, etc., related to beer production and sales were estimated at EUR 651 million.