Wave of price hikes sweeping beer industry

The Yomiuri Shimbun

12:15 JST, May 29, 2022

Beer and other alcoholic beverages will be a bit more pricey in autumn, as major brewers plan to raise their prices due to soaring prices of grains and other raw materials.

Suntory Holdings Ltd. announced Thursday it will raise the prices of a total of 156 products, including its flagship beer The Premium Malts and chuhai spirits, for shipments from Oct. 1.

Store prices for its beers are expected to rise by 6% to 10%.

The price hikes will also apply to Kinmugi, a so-called third-segment quasi beer, and All-Free, a nonalcoholic beerlike beverage. Store prices of chuhai spirits such as Kodawari Sakaba no Lemon Sour are expected to increase by 2% to 6%.

The move is the latest in a string of price hikes by Japanese brewers.

On Wednesday, Kirin Brewery Co. announced that it will raise the prices of its mainstay Ichiban Shibori Draft Beer and other beers, as well as chuhai and other liquor products, for deliveries from Oct. 1, citing soaring prices of barley, corn and other ingredients.

This is the first time in 14 years that Kirin has raised the prices of its home-use products. Since the products are marketed under an open-pricing scheme, the brewery will raise the wholesale prices for supermarkets and other outlets, which will then decide prices on the shelves. Store prices of Kirin beer and chuhai are expected to rise by 6% to 13%.

The price hikes will affect 278 products, including Honkirin, a third-segment quasi beer, Hyoketsu chuhai spirits, happoshu low-malt beerlike drinks and whiskeys. Prices will increase for a total of 222 beer and chuhai products, or about 90% of this category. In addition to raw materials, the rising prices of aluminum, cardboard, electricity and other production costs are also attributed to the planned price hike, Kirin said.

However, Kirin will keep the price of its Spring Valley craft beer unchanged. As it is made from a wide variety of hops, which determine the beer’s aroma, its price is already higher than other beers.

The company may be aiming to use the price increase of its popularly priced products as an opportunity to boost sales of its premium products, as a price gap would be smaller.

Beer giant Sapporo Breweries Ltd. told The Yomiuri Shimbun on Wednesday that it is considering a price hike, but it has yet to decide which products would be subject to an increase or by how much.

A Sapporo public relations official said it “plans to make an announcement in the near future.”

Asahi Breweries, Ltd. has already announced that it will raise the prices of about 160 products, including its mainstay Super Dry beer, for shipments from Oct. 1.

Since beer is a luxury item, consumers tend to be more sensitive to price fluctuations. A series of price hikes could have a negative impact on the recovery of domestic liquor sales, which have declined due to the novel coronavirus pandemic.