After the Covid-19 pandemic restrictions took its toll on the alcohol industry, the recent increase in beer consumption is good news to hops and barley farmers, and establishments that sell the product. Food For Mzansi caught up with the CEO of the Beer Association of South Africa (BASA), Patricia Pillay.
Following the loss of 161 trade days over a 16-month period due to lockdown restrictions, things are looking up.
The world’s largers brewer, AB InBev SA, who owns South African Breweries, recently announced that beer revenue grew at 30.7% year on year, following two years of Covid-19 destruction.
So we caught up with Pillay to discuss the beer industry post lockdown.
Tiisetso Manoko: This sounds encouraging. What does this sales result mean to hop farmers and the industry?
Patricia Pillay: This is great news for the industry, which is still focused on recovering from the devastating four alcohol bans during the Covid-19 lockdowns and for those who received zero financial support.
For me, government needs to come to the party in addressing the challenges that the sector is facing.
We have continuously said that during the period of the National State of Disaster, we have not been consulted as an industry. We have not been allowed to put our case forward regarding the impact that these lockdowns have had on us.
Are South Africans drinking more beer and why?
According to NielsenIQ market track which includes more than 10 000 supermarkets and garage forecourts, and 143 000 independent stores, beer was the No 1 fast moving consumer good in South Africa over five weeks up to April 2022.
Data shows that consumers are making better health choices post Covid. They are more concerned about their drinking levels and beer has the lowest alcohol by volume (ABV).
However, analysts say that this growth must be seen within the context of the four alcohol bans, which means that the alcohol sector would be experiencing high growth rates off previous lows from the previous year, where there were some months where zero beer sales took place.
What has the growth of the sector been like over the years?
The craft beers were showing a promising growth compared to previous years with pricing and health contributing to the slow growth.
Should there be no further bans, the industry will continue to recover and the hops and barely sectors are going to provide a much-needed economic boost and create jobs.
One of BASA’s members, SAB, currently farms over 400 hectares of hops across 11 farms.
In 2021, these farms produced almost 200kg of hops per hectare, contributing up to R 900 million in revenue to the Western Cape’s economy and employing over 1 500 people.
Tell us more about your expectations and plans for further recovery…
There is room for growth, and I hope that local hops producers will one day be able to compete with the largest producers like USA.
Another key focus area for BASA is growing beer tourism in our country and making South Africa a beer destination of choice. One of the tools to achieve this is our brew routes campaign.
The brew routes website presents an online interactive map that provides the locations of 150 craft breweries across the country.
These downloadable maps also highlight other tourist attractions, which can be visited as part of these routes. We are constantly testing and trying out new brew routes in provinces and regions, with the aim to upload these over the months to come.
What is the outlook for the remainder of the year?
Should there be no further enforced bans, the industry will continue to recover and hopefully grow, which will benefit the entire beer value chain, from the hops and barely sectors to the breweries and the establishments that sell beer.
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