Hungary: Brau Union Hungaria, one of Hungary's three leading breweries, is to shed 17% of its workforce early next year in a bid to reduce costs and remain competitive in an increasingly difficult market, the company has recently announced. The move involves the loss of some 124 jobs, reducing Brau Union's total headcount from the current 750 to around 625 workers, The Budapest Sun commented on December 16. The cuts will affect the company’s two breweries at Sopron, western Hungary, and Martfû, in the centre of the country.

The redundancies come in the wake of a surge in imports of cheap canned beer, mainly from Germany, the result of a dramatic drop in sales in canned beer there after the Bundestag introduced a new law requiring a deposit to be paid on non-returnable containers. As consumers switched back to bottled beer, breweries equipped with canning lines looked east in order to utilize the spare capacity.

"Since the beginning of this year we have been flooded with imports of cheap canned beer, mainly from Germany and Czech Republic. One supermarket has been selling beer for only Ft49 (¢26) a can. This is too low, and we have to adjust to this," said László Diós, head of Human Resources at Brau.

Soproni Ászok, Brau's leading local mainstream brand, typically retails for around Ft115-130 (¢62-70) per half liter, but increasingly common special discount offers reflect the ruthless market competition. Imports this year are expected to total some 800,000 hectoliters, roughly four times the figure for 2002, and equating to 12% of the total Hungarian market estimated at 7.7 million hectoliters.

Brau Union, which is now part of the Heineken group, also produces or markets brands such as Gösser, Kaiser, Amstel and the synonymous Heineken lager.

E-malt.com, the global information source for the brewing and malting industry professionals. The bi-weekly E-malt.com Newsletters feature latest industry news, statistics in graphs and tables, world barley and malt prices, and other relevant information. Click here to get full access to E-malt.com. If you are a Castle Malting client, you can get free access to E-malt.com website and publications. Contact us for more information at marketing@castlemalting.com .