 |
| The Netherlands, Belgium and Ireland in the lead in the proportion of production exported. The Netherlands is also the biggest exporter, followed by Germany. The Dutch export about double Ireland's total production. |
Economic Impact of Beer in Europe: Irish excise duty rate on beer is one of the highest in Europe and 9 times the European average, according to a new report produced by Big 4 accounting firm Ernst & Young, into the beer industry in Europe. However, the Irish are also among Europe's biggest biggest beer drinkers.
The report entitled Contribution made by beer to the European economy, produced on behalf of the Brewers of Europe, also shows that despite a less favourable economic environment, Europe has defended its leading position as the world’s largest beer producer. With a yearly production of 427 million hectolitres (hl - - 100 litres), Europe remained ahead of China (393 million hl) and the US (234 million hl), the report stated, which was conducted in all 27 EU countries plus Norway, Switzerland, Croatia and Turkey.
Europeans consumed 394 million hectolitres in 2008.
Germany remains Europe’s largest beer producer (103 million hectolitres), followed by the UK (49.5 million hl), Poland (36.9 million hl) and Spain (33.4 million hl).
Countries differ in the number of breweries operating within their borders. Germany is the country with the most breweries within its borders (1,330). Eight other countries have 100 or more breweries per country: United Kingdom (667), Italy (272), Switzerland (270), Austria (164), France (132), the Czech Republic (128), Belgium (135) and Denmark (120). In the other twenty two countries the number of breweries differ from 72 in the Netherlands to just one in Malta.
In Ireland, there are four medium and large brewing companies in Ireland owning six breweries and at least 20 microbreweries.
Ireland – Production
Today’s report shows Ireland is the 3rd largest exporter of domestically produced beer behind the Netherlands and Belgium - - not to be confused with total export ranking. The report confirms the extent of the size of these export markets with exports as a percentage of production numbers ranging from 52% (Ireland), 57% (Belgium) to 62 % (Netherlands).
Guinness, Heineken and Stella Artois are global brands.
The Netherlands is Europe’s largest beer-exporting country, and ranks fifth in production (behind Germany, the United Kingdom, Spain and Poland). In the rest of the world, only Mexico exports more hectolitres of beer. 16.7 million hectolitres of the total beer production in the Netherlands in 2008 (27.2 million hectolitres) was exported to other countries.
In 2008 Germany exported 15 million hectolitres of beer.
The report also shows there has been a reduction in recent years in terms of the amount of beer being produced by brewers in Ireland with 8.846 million hectolitres produced in 2008 from highs of 9.377 and 9.270 hectolitres produced in 2006 and 2007 respectively.
Ireland – Import & Consumption
Irish people consumed on average 98 litres of beer per head of population in 2008. Draught lager makes up the majority of beer sales (61%), with Stout (33%) and Ale (6%) making up the remainder.
The report does not give a consumption per capita for all countries (maybe it was an issue that was not to be highlighted).
The Czechs drink 158 litres of beer per head (a big influx of tourists would influence the data); Finland 87; Poland 93; Netherlands 78; Spain 52 and Italy 32.
Only 17% of beers consumed in Ireland are imported which placed the country 10th in Europe in terms of importation of foreign beers, slightly above the European average (10%).
The report also confirms a long-standing difference in drinking cultures between Ireland and its fellow European nations. Non-Irish European nations purchase 60% of their beer for home consumption from supermarkets and off-licences unlike their Irish counterparts who only purchase and consume 31% of beer in this manner; rather choosing to purchase and consume the majority of beer in pubs and hotels.
However, the report confirms that this trend has been changing since 2007 as beer consumption in the Irish hospitality industry has dropped by 4% whilst beer purchases in shops and off-licences has increased by over 8% over the same time. The introduction of the smoking ban in Irish hospitality venues is believed to have contributed to this trend.
In Germany, beer is currently consumed for 71 % off-trade, and 29 % on trade in bars and restaurants
Ireland – Tax Revenues
At €1,987 per hectolitre of pure alcohol, the Irish excise duty rate on beer remains one of the highest in Europe - - nine times greater than the European average. Only the UK, Finland and Norway have higher rates. The total excise revenue arising from the brewing industry in Ireland amounts to €427m.
Total Government revenues from the beer industry are €1,485 million consisting of Excise duty (€427m), €416m from income-related taxes from beer production e.g. employee income taxes and VAT (€642m) largely coming from the hospitality sector where the greatest amount of beer is sold.
Dermot Quinn, Industrial, Commercial and Technology Partner with Ernst & Young comments, “This report proves that Ireland's beer sector remains a key component of our export economy and the Government needs to ensure that their future approach to taxation policy does not further negatively impact an industry already heavily burdened by taxation."
Europe
The report shows that the number of breweries across Europe has grown almost 25% in the last three years, up from around 3,000 in 2006 to 3,733 today.
Directly and indirectly 2.5 million jobs in Europe can be attributed to the beer producing and selling sector, which brings Europe’s economy in an additional €59 billion in terms of value added and national governments roughly €57 billion in beer tax revenues.
According to the report, since the last similar report was conducted by Ernst & Young in 2006, the general business conditions for Europe’s brewers have overall deteriorated. Agricultural raw materials and the overall associated costs of production are up (nearly 24%) and taxes (up nearly 30% in the Netherlands) have gone up dramatically in some countries, while the general economic downturn has put further strains on the sector.
Quinn concludes, “In the current environment it is important to protect any industry which is bringing in revenue and sustains jobs. Business conditions for the brewing industry must remain competitive if we are to sustain the current benefits of this export market brings to Ireland."
Finfacts report: Global alcohol country rankings
