As summer hots up, beer prices in State set to soar

Cost of popular brands could increase between Rs 5 and Rs 15

As temperatures soar, bottled beer is all set to cost more in the next few days with manufacturers proposing to increase its retail price.

The move comes at a time when beer sales spike with consumption reaching new highs to beat the sweltering heat. Temperatures are already hovering above 35 degrees Celsius in most parts of Karnataka.

Bengaluru recorded an all-time high of 37.4 Celsius on March 11.

According to industry insiders, the price of most of the popular brands could increase ranging between Rs 5 and Rs 15 per bottle when fresh stocks are released in the retail market commencing March 15.

Budweiser had already hiked the price of some of its brands. For instance, the price of a 500ml Budweiser Magnam strong beer can has been increased from Rs 100 to Rs 110. Most of the other brewers will follow suit. The quantum of increase in various brands would be known once the fresh stocks arrive, traders said.

It is well known that the State, especially Bengaluru, is a great beer guzzler. According to statistics compiled by the State excise department, the total sales of beer in the financial year 2014-15 stood at 253 lakh cartons.

The department uses ‘carton’ as the measure to count the total sale of beer. (Each carton has 12 beer bottles of 650ml each).

Consumption peaks as temperatures soar in March, April and May. The average monthly sales in the State last year stood at 20 lakh cartons, while the three peak months clocked 26 lakh boxes. Bengaluru gulps 32% of the total beer consumed. It is also seen that consumption of the amber brew increases during cricket season. With T20 World Cup just round the corner, beer consumption is expected to touch a new high.

The manufacturers’ move to hike prices comes just days ahead of the State budget proposals for the financial year 2016-17 are to be presented. Chief Minister Siddaramaiah, who also holds the finance portfolio, can tinker with the excise duties on beer and hard liquor in his proposals to mop up additional resources. While Siddaramaiah had left excise duties on beer untouched last year, he had increased it by 21 percentage points in 2014-15. The total additional excise duty on beer stands at 135% of the declared price.