Brewers call for more State support to survive extended pub lockdown

Irish beer sales and exports have taken a hit from the pub trade being largely closed for the past 13 months.

Irish brewing companies are calling for increased financial support to allow them survive the extended closure of the pub and hospitality sector due to the Covid restrictions.

The closure of the hospitality sector for the bulk of 2020 resulted in a 17% drop in beer sales – which are predominantly on-trade reliant – last year, with the value of beer exports from Ireland falling from €305m to €254m. 

There was a 45% drop in exports to the US, alone.

“We are calling for financial aid to support the coverage of costs associated with the uplift, disposal, and writing-off of out-of-date beer caused by repeated lockdowns,” said Drinks Ireland’s Jonathan McDade.

“Furthermore, the sector requires a change in the duty system, allowing for excise to be recovered in a similar manner to VAT on bad debts, which would prove invaluable in us continuing to support the provision of credit to the hospitality sector,” he said.

“As the vaccine rollout continues, the beer sector hopes to be able to see consumers back in pubs later this year. But, it is vitally important that it receives additional supports from Government to allow it to endure the extended lockdown, which continues,” Mr McDade said.

Reliance on the pub trade

Showing the impact lockdown has had on the Irish beer industry, and its reliance on the pub trade, production fell nearly 14% last year due to bar closures and beer’s share of the alcoholic drinks market dipped from nearly 45% to just under 39%.

“As a drink that is mostly popular in our pubs, the sector has been profoundly impacted by Covid-19. And with hospitality businesses remaining closed, the challenges continue for our sector in 2021,” said Peter Mosley, Drinks Ireland-Beer chairman and managing director of the Porterhouse Brewing Company.

“Coupled with a fall in sales for Irish beer, brewers have also provided extensive financial support to their hospitality customers at a heavy cost, carrying out keg uplifts, and organising for the disposal of unsold and out-of-date beer in an environmentally friendly manner," he said.

Drinks Ireland also said its research showed that beer drinkers in Ireland continue to pay the second highest excise rate in the EU.