Beer prices set to rise as increases impact

JOHN HAWKINS/ID 123074

ON THE RISE: Invercargill Brewery owner Steve Nally checking this season's malt barley, which has gone up in price.

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A pint at the pub could soon cost a bit more, with international demand pushing up the price of some ingredients by as much as a quarter.

Invercargill Brewery owner Steve Nally said he expected the average beer price for consumers could increase by about 7 or 8 percent because of increased demand for barley and hops. At present international demand exceeded supply, which impacted the price, he said.

The cost of the base malt used at the brewery had risen by 20 percent, while the price of the other malts it used had risen by about 25 percent. There was also an indication that a world shortage of hops could push up that price by 25 percent.

In the United States, the world's biggest hops supplier, poor weather, disease and a fire had wiped out crops, which would be short by about 30 percent.

The change in use of barley, which could also be used for biofuels, had also had an impact on the stock available.

Mr Nally said he thought it was likely all breweries would have to raise prices to cover increased costs.

Other price increases in products such as fuel, plastic, glass and electricity had also had an impact, he said.

The brewery raised its own prices at the start of the month and Mr Nally said he thought most breweries would follow suit around July or August.

Dux de Lux master brewer Dick Fife, based in Queenstown, said prices would also be rising, but he was not at liberty to say by how much.

The price rise was because of rising fuel, transport and product costs, he said.

Beer drinkers may have to adapt their tastes as climate change affects barley production, according to a senior climate scientist.

National Institute of Water and Atmospheric Research spokesman Jim Salinger said drought-like conditions in Australia, where malting barley was cropped, were likely to get worse, and New Zealand barley production in the main growing region of Canterbury would also be affected during the next 30 years. Lion Nathan gets about 70 percent of its malted barley from Canterbury.

Brewers will have to adapt to different cultivars and growing seasons, Dr Salinger said.

He said there could be an expansion of malting barley production in Otago and Southland, but Australian production was likely to be hit hard in areas of Western Australia, South Australia, Victoria and New South Wales.

- © Fairfax NZ News