Brewers Association

Craft Segment Retail Pricing Grows 2.6%

The October 30 Symphony IRI Group data was released today, showing a second month of climbing retail pricing for the craft segment. For the scan period ending October 30 pricing gains were at a level of 87 cents per case compared to one year ago, up from 52 cents per case growth the during the scan period before and 14 cents per case before that. All beer retail pricing grew at 72 cents per case in the 4-week period, as large brewer price increases appear to be filtering to the consumer level. The U.S. inflation rate is growing at 3.87% through September; craft beer retail pricing grew at 2.64% compared to a year ago. All beer retail pricing was up 3.48%, also below inflation.

Craft volume growth decelerated in the higher pricing environment. Craft volume was up 13.7% against the previous month's growth of 17.2%. The past several months we have seen that volume growth and pricing growth appear to be closely related. Perhaps some retailers felt large brewer price increases gave them cover to raise craft prices, or they had a desire to maintain a similar gap as large brewer beer prices climbed as announced for October. Perhaps some craft brewers are feeling the pinch on barley price increases.

Craft Pricing

4 Weeks to October 30, 2011--up 87 cents per case.

Year to Date 2011--up 49 cents per case

52 Weeks (October 2010-early October 2011)--up 48 cents per case.

Here's a rundown of some of the other craft figures from the SIG report for food/drug and convenience stores.

4 Weeks to October 2, 2011--13.7% volume growth; 16.8% dollar growth. (All beer -0.8/+2.8)

Year to Date 2011--14.3% volume growth; 16.1% dollar growth. (All beer -0.7/+1.9)

52 Weeks (October 2010-early October 2011)--14.5% volume growth; 16.2% dollar growth. (All beer -1.0/+1.5)

Craft gained 0.4 share points over the scan period by volume and 0.6 share points of dollars. Imports and domestic superpremium gained 0.7 and 0.5 share points in volume, respectively. The low and middle sections of the beer industry are losing 1.6 share points to the high end right now.

In the area of beer styles,  IPAs gained 2.8 volume share points in craft  and showed 46% growth as a style in scans. Variety packs also continues to grow over 1 share through October. Seasonals are losing share within craft even though they continue to grow at double digits. Craft Belgians surged with over 60% volume growth compared to a year ago. We don't have a split on what part of that would be sour beers, but at numbers like that, it is save to assume the gamut of U.S.-made Belgian-inspired beers are growing.

Paul Gatza

November 10, 2011

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