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BeerThe Irish Beer Market Report 2018

The Irish Brewers Association (IBA) ‘Beer Market Report’ highlights the role of the brewing sector in Ireland’s economy. Beer comfortably remains Ireland’s favourite alcohol beverage with a 45% market share in 2018. Last year Ireland’s economy continued to perform well with a growth of just under 7%. This was driven by strong growth in consumer spending, investment, and exports which was facilitated by growth in employment and wages. With household incomes growing by 6%, disposable income per person is now back above its peak levels for the first time.

2018 saw total beer sales by 3%, although per capita consumption rose fractionally by just 0.4%. This marginal increase in per capita consumption is in line with an overall trend that people in Ireland are drinking much less alcohol with the average per adult consumption rate falling by 23% since 2001. The increase in total beer sales is reflected in the increase in beer production in Ireland by 3.8% in 2018 compared to the previous year. Direct employment in Ireland’s brewing sector also rose in 2018 by 3%.

However, the increase in domestic sales has been tempered by a marginal decrease in the value of beer exports by 1.8% to €268 million in 2018. Ireland remains a beer export powerhouse and is the 7th largest exporter of beer in the EU. The UK remains the top destination for Ireland’s beer exports accounting for €109 million worth of exports. Uncertainty around Brexit remains a serious concern for Ireland’s brewing sector. However, it is noticeable that the value of beer exports to France rose from €19 million in 2017 to €32 million in 2018.

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In terms of market share of beer variants, lager saw the biggest growth with a 3 point increase in its market share to 63.8%. Stout’s market share dropped from 32.2% to 29.3% while ale’s share fell marginally from 6.6% to 6.3%. It is interesting to note that non-alcoholic beer sales rose by 60% and currently has a 0.6% market share.

Ireland’s on-trade beer sales continue to outperform off-trade sales by 63.5% to 36.5%. Though, off-trade sales have gained ground in recent years. The most recent craft beer sales data from 2017 shows the sector holding a 2.6% market share in sales and a 1.9% share of total beer production.

The brewing sector continues to make a significant contribution to the exchequer both directly and indirectly. In 2018 beer contributed €430 million to the exchequer in excise alone, an increase on the 2017 figure of €424 million. Irish beer drinkers continue to pay the second highest rate of excise on beer in the European Union. In 2012 and 2013 beer excise rates rose by 42% which means that since 2009 the brewing sector has contributed €3.8 billion to the exchequer in excise alone. That’s no small beer…

Beer is a significant economic and cultural asset in Ireland. The IBA calls on the Government to assist the industry by reducing excise on beer in the forthcoming budget.

Jonathan McDadeHead of the Irish Brewers Association

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In 2018 beer contributed €430 million to the exchequer in excise alone, an increase from €424 million in 2017.

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Headlines Production in 2018

Stout63.1%

Lager30.7%

Ale6.2%

2018

2017 2018

Total Production (1,000HL) 8,019 8,322

Source: IBA Members

2017 2018

Total Employment 1,064 1,103

Source: IBA Members

2017 2018

Total Consumption (1,000HL) 4,497 4,630

Source: Revenue

2017 2018

Per Capital Consumption 79.1 79.5

Source: Calculation based on consumption but as 5%ABV (pan-European benchmark) and CSO population figure of 4,857,000

2017 2018

Export value €273m €268m

Source: Eurostat

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Craft Beer Market

Sales Channel

Year 2014 2015 2016 2017

Production output of microbreweries

86,000HL 134,000HL 142,000HL 157,000HL

% share of production 1.18% 1.72% 1.84% 1.90%

Year 2014 2015 2016 2017

Craft beer sales 54,000HL 110,000HL 119,000HL 127,000HL

% Market Share 1.2% 2.5% 2.6% 2.6%

Source: The Development and Economic Impact of Microbreweries in Ireland – A Bord Bia Report for the Independent Craft Brewers of Ireland

2017 2018

On-Trade 64.8% 63.5%

Off-Trade 35.2% 36.5%

Source: IBA Members

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Variants

Beer: On-trade vs off-trade (2018)

Source: IBA Members

lLagerlStoutlAlelNon-Alcoholic

60.8

%

63.8

%

32.2

%

29.3

%

6.6%

6.3%

80

70

60

50

40

30

20

10

0

2017 2018

lLagerlStoutlAlelNon-Alcoholic

100

80

60

40

20

0

On-Trade (2018) Off-Trade (2018)

54.5

%

45.5

%19

.9%

19.3

%

80.1%

80.7

%33

.3%

66.7

%

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0.4%

0.6%

Alcohol Consumption by Category Mix

Source: Revenue Commissioners

Cider7.7%

2017Beer44.8%

Wine27.7%

Spirits19.8%

Cider7.5%

2018Beer45.0%

Wine27.0%

Spirits20.5%

Draught vs packaged beer% 2017 2018

Draught 51.4% 48.6%

Packaged 50.2% 49.8%

Source: IBA Members

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Direct employment in Ireland’s brewing sector also rose in 2018 by 3%

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Excise receipts

Excise duty on a pint

2017 2018

Beer €424m €430m

Wine €382m €376m

Spirits €353m €372m

Cider €61m €61m

Total €1,220m €1,239m

Beer as % 35% 34.7%

Source: Revenue Commissioners

Source: DIGI – May 2019

Average price of a pint of lager

€4.94Average price of

a pint of stout€4.55

% paid in tax28.5%

% paid in tax29.2%

VAT 86cExcise 55c

VAT 79cExcise 54cTotal tax

€1.41Total tax€1.33

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Pan European Beer Per Capita ConsumptionLitres of beer at 5 percent of ABV

* 2017 figuresSource: Brewers of Europe (2017) and IBA (2018)

Rank Country Per Capita Consumption

1 Czech Republic 1382 Germany 1053 Austria 1014 Poland 975 Lithuania 80*6 Estonia 827 Romania 828 Croatia 799 Ireland 7910 Latvia 7911 Slovenia 78*12 Finland 7713 Luxembourg 7614 Bulgaria 7415 Slovakia 7216 Netherlands 7017 Belgium 68*18 United Kingdom 6719 Hungary 6320 Denmark 6221 Cyprus 5822 Malta 5223 Portugal 5124 Sweden 4825 Spain 4826 Greece 3527 France 3328 Italy 32

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European Beer Excise Rates

€108.24€101.57

€37.96

€21.55

€20.89€9.96

€24.05

Excise duty in Euro on beer 12 degrees Plato / 4.8% ABV (1HL) in EU

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Rank Country HL Excise Rate

1 Finland 175.202 Ireland 108.243 United Kingdom 101.574 Sweden 94.925 Estonia 81.226 Greece 60.007 Slovenia 58.088 Netherlands 37.969 Denmark 36.01

10 Italy 35.8811 Lithuania 34.1312 Latvia 32.6413 Cyprus 28.8014 Croatia 25.8715 Hungary 24.1216 Belgium 24.0517 Austria 24.0018 Malta 23.1619 Poland 21.7620 France 21.5521 Portugal 20.8922 Slovakia 17.2223 Czech Republic 14.9124 Spain 9.9625 Luxembourg 9.5226 Germany 9.4427 Bulgaria 9.2028 Romania 8.76

Rates at January 2019Source: Brewers of Europe

€94.92€81.22

€60.00

€58.08

€37.96

€34.13

€32.64

€36.01

€35.88

€21.76

€17.22€14.91

€28.80€23.16

€25.87

€24.12

€24.05

€24.00

€175.20

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€9.52

€9.20

€8.76

€9.44

Export DestinationsRank Country Vol – 100kg

1 United Kingdom 3,345,171

2 United States 455,385

3 France 372,559

4 Germany 132,839

5 Spain 118,119

Source: Eurostat

Export Destinations – by value (€)Rank Country Value in €

1 United Kingdom €109m

2 United States €52m

3 France €32m

4 Germany €16m

5 Canada €12m

Source: Eurostat

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Notes

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Alcohol Beverage Federation of Ireland

84/86 Lower Baggot Street

Dublin 2

T: + 353 1 605 1500

E: info@abfi.ie

W: www.abfi.ie

@abfi_ireland