Mexico's top brewer Grupo Modelo said on January 26 it had raised the prices of some of its brands by between 4 and 5 % to adjust for inflation in 2003, Reuters released. Modelo spokesman Jose Pares said the price rise would affect certain brands in parts of the country, but declined to provide further details. He said he did not expect other rises for 2004. The rise comes after Modelo and its Mexican competitor, bottler and brewer Femsa, froze prices nearly two years ago amid a domestic economic slowdown and weak growth in Mexican beer consumption.

"In early January certain (price) adjustments were made in certain areas of the country, not in all, and those adjustments reflect inflation," Pares told Reuters. "We don't expect other rises later in the year."

Mexico's economy has been weak for the last three years, although inflation dropped to 3.98 percent in 2003, its lowest level in 35 years, amid conservative monetary and tax policies.

According to personnel at two Modelo distributors contacted by Reuters, as of Jan. 1 prices had gone up by about 5 pesos (46 U.S. cents) per case. The price of a case of 20 half-liter bottles of its popular Corona brand, for example, rose to 91 pesos ($8.32) from 86 pesos. A case of 24 cans of Modelo beer rose to 183 pesos ($16.73) from 178 pesos.

Analysts expect 2004 to be a better year for beer in Mexico, as the economy strengthens and more people buy beer. ($1=10.9340 pesos)

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