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Domestic sales of brewery beverages down 3.4 per cent – it’s time to reverse the trend with the Danish model

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A total of 571.1 million litres of brewery beverages were sold in January-September 2015. Domestic sales of beer, cider, long drinks, mineral waters and soft drinks were down 19.9 million litres, or 3.4 per cent. These figures are based on sales statistics compiled by the members of the Federation of the Brewing and Soft Drinks Industry: Captol Invest, Hartwall, Olvi, Red Bull, Saimaan Juomatehdas and Sinebrychoff.

Domestic sales of brewery beverages have been on the decline for a long time. During the past ten years, sales have decreased by 10 per cent. Finland’s high alcohol taxes have driven consumers to buy their beverages from Estonia. Only a third of the beer imported by travellers from Estonia and ships is brewed in Finland.

“This is a harsh state of affairs for Finland. We still consume, but the tax revenue goes to Estonia,” says Elina Ussa, Managing Director of the Federation of the Brewing and Soft Drinks Industry, referring to the high volume of travellers’ private imports of beer from Estonia.

Finnish breweries have felt the consequences of high taxes. Beer production in Finland has decreased by 55 million litres in ten years. At the same time, beer production in Estonia has increased by 57 million litres.

Danish alcohol policy supports domestic industry

Denmark lowered its beer tax by 15 per cent in summer 2013 in order to put the brakes on cross-border trade. From 2013 to 2014, beer sales in Denmark grew by 3 per cent. In the Finnish beer market, growth of 3 per cent would mean an increase of 12.5 million litres in annual domestic sales.

“Denmark is a good example of how small measures can reverse a trend. In order to reduce cross-border trade and grow the domestic market, Finland should make moderate cuts to its beer tax, by 15 per cent each time,” says Ussa.

Denmark’s alcohol policy strengthens its domestic market and industry. In addition to lowering the beer tax, the country has lifted restrictions on alcohol advertising and has not set limitations on the times when alcohol can be sold. In spite of these steps, the adverse effects of alcohol are smaller in Denmark than in Finland.

“In order to mitigate private imports by travellers, Finland should follow the example of Denmark, which has a proactive alcohol policy that has a positive effect on domestic industry,” says Ussa.

Denmark’s decision to lower the beer tax also indicates the country’s desire to steer consumption to mild alcoholic beverages instead of strong drinks. At present, strong alcoholic drinks account for 14 per cent of total alcohol consumption in Denmark, whereas in Finland they account for a quarter.

DOMESTIC SALES 1 Jan. 2015 – 30 Sep. 2015

Beverage 2015 2014 Change Change
mill. l. mill. l. mill. l. %
Beer 289.2 295.0 -5.8 -2.0
Cider 22.4 24.4 -2.0 -8.1
Long drinks 27.6 30.7 -3.1 -10.1
Soft drinks 178.3 183.3 -5.0 -2.7
Mineral waters 53.6 57.6 -4.0 -6.9
Total sales 571.1 590.9 -19.9 -3.4

Source: Member companies of the Federation of the Brewing and Soft Drinks Industry. The statistics do not include sales by actors outside the Federation nor private imports of brewery products, which are not statistically recorded. As of the beginning of 2011, the statistics include all the brands of the members of the Federation of the Brewing and Soft Drinks Industry and any private label brands they produce.

Category: Business