Czech Republic: New segments, export, hot weather boost beer sales

If it wasn’t for export and the consumption of beer by foreign visitors, the Czech Republic might have lost its position as the country with the world’s highest per capita beer consumption, at about 158.1 hectoliters, Czech Business Weekly reported July 30.

The country’s breweries exported about 18 percent of the overall beer output last year, an unusually high figure among leading beer countries, as the beverage is normally consumed in its country of origin, the Czech Beer and Malt Association (ČSPAS) said. “Beer export is globally growing by 6 percent, but the Czech Republic has a double-digit growth. It’s a miracle that we’re doing so well,” Jan Veselý, ČSPAS’ executive director told CBW earlier. Last year, breweries exported a record-high 3.53 million hectoliters, 14 per cent more than in 2005; and overall production increased by 3.8 percent to a record-high 19.79 million hecto-liters over the same period.

The country has 48 breweries and nearly 60 mini-breweries, with the market leaders maintaining their positions for a number of years. The Czech Republic’s top three breweries are Plzeň, West Bohemia-based Plzeň-ský Prazdroj, followed by Prague-based Pivovary Staropramen, and České Budě-jovice, South Bohemia-based Budějo-vický Budvar, according to ČSPAS, and these are also the country’s largest beer exporters.

Nearly all of the market leaders are in the hands of global brewers like SABMiller, InBev and Heineken—which in June boosted its position on the Czech market when it acquired Královský pivovar Krušovice—only stateowned Budějovický Budvar, Zlatopramen maker Drinks Union, and Zubr maker PMS Přerov remain up for grabs.

Nonalcoholic beer is the fastest grow-ing beer segment, registering double-digit beer sales and currently produced by 19 breweries (see “Nonalcoholic beer hops on- to the market,” CBW, July 16, 2007). Last year local breweries produced 328,000 hectoliters of nonalcoholic beer, up 37 per cent on the year.

South Moravia-based Pivovar Černá Hora brewery launched distribution May 1 of its 0.0 percent alcohol beer Forman to the Czech and Slovak markets, although in the Czech Republic nonalcoholic beer can contain up to 0.5 percent of alcohol. Forman enjoys high demand and its output is ever increasing, said Hubert Adámek, spokesman for Pivovar Černá Hora. The brewery plans to produce and sell between 1,500 and 2,000 hectoliters of Forman this year, he said. Forman is delivered to the market in 0.33-liter bottles and 20-liter kegs. Pivovar Černá Hora at the same time introduced three other new products, including an unfil-tered bottled beer called Moravské nefil-trované Sklepní, until now available only in restaurants, and Mladinká, a non-alcoholic lemon-flavored malt beverage, Adá-mek said.

The specialty beer segment had been growing since at least 2000 and in 2005 reached an output of 210,000 hectoliters, but last year its overall Czech production dropped to 88,000 hectoliters, ČSPAS said. Nevertheless, some courageous minibreweries hope to break through with their specialty beers to a wider public. Consulting firm Pivo Praha, which operates restaurant and microbrewery Pivovarský dům in Prague 2—in addition to a restaurant and specialty beer store in Prague 8—is slated to start distributing its wine-flavored beer Šamp as of August in major retail chains, Pivo Praha’s co-owner Jan Šuráň told CBW. The compa-ny is currently negotiating listing fees and other charges with Tesco Stores
ČR to distribute the specialty beer. Pivo Praha produces Šamp in cooperation with brewery Měšťanský pivovar Strakonice.

This year’s warm weather beginning in April, start-ed the beer season earlier than usual and will help to boost 2007 beer sales on the domestic market. In July, Plzeňský Prazdroj’s Radegast brand registered an 80–100 percent increase in sales compared to the winter months as Czechs like to take it with them on vacation, the company said. Drinks Union, also among the top 10 breweries in the country, saw an 18 percent surge in beer sales in mid-July when temperatures soared to nearly 40 degrees Celsius in some parts of the country. Drinks Union, which operates four breweries in North Bohemia, was running at full capacity, the Czech News Agency (ČTK) reported. Drinks Union also said that sales of bottled and canned beer in hypermarkets and supermarkets are growing as people are having barbeques and parties in their gardens. Pivo Praha’s restaurants aren’t located in tourist locations in Prague, and typically register their worst sales in July, with about a 30–40 percent slump during the scorcher season, Šuráň said. “When it’s too hot, [Czechs] leave and prefer places outside of the city—like lakes—so you see more beer sales at outdoor beer stands or in bottled beer,” he said.

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