Why is Beer So Expensive? – How Inflation is Affecting Beer Prices
It’s not just gas prices that are on the rise. Some of the world’s major beer companies have announced that the price of beer will be increasing in 2022. Find out why beer is expected to be more expensive.
By Clara Jaide on Feb. 22, 2022
We’re sure you’ve noticed the price of daily necessities have been on the rise. From milk and eggs to gas prices, we are seeing a serious spike in the cost of living in countries all around the world. According to a research study conducted by the BBC, the cost of living in the UK is expected to rise by over 7% by the end of 2022. The price of beer isn’t an exception.
Following one of its best years in revenue, the world’s second largest brewer, Heineken, has announced that beer drinkers can expect an increase in the price of their beloved beers due to the impact of inflation. The Dutch brand, best known for their best-selling lager, Heineken, and Strongbow ciders, profited over $3.3 billion euros in 2021 despite the pandemic. Now, they are expecting a jump in production costs, which in turn, creates an increase in the price of their beers. This news came not too long after fellow beer brand, Cobra, announced the expected price hike of their beers, as well.
Why are beer prices going up?
So, why the spike in beer prices? Well, there are many factors that play into the change in price of beer. The biggest reason: beer ingredients are more expensive. When it costs more to make an item, it costs more to buy the item and beer ingredients are getting hit by inflation, as well.
According to a representative from Heineken, the price of ingredients, like barley, and the cost of production have increased by around 15%. “These kind of price increases and inflation, I think we have not seen in a generation.” says Dolf van den Brink, Heineken’s Chief Executive Officer.
How much will beer cost now?
As of now, the future price of beer is unknown. While both Cobra and Heineken have yet to comment on how much the increase will be, it’s safe to assume that once the prices are announced, other brewers will follow suit.
So, it might not be a bad time to start a beer fund. You know, for rainy days… or Tuesdays.
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