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CASTLE MALTING NEWS in partnership with www.e-malt.com Chinese
04 March, 2021



Brewing news Thailand: Small craft brewers find virus rules hard to swallow

Small craft-beer companies in Thailand already grappling with onerous regulations have faced another blow in recent months from measures to curb the spread of the virus that have robbed them of vital sales channels, the Nikkei Asia reported on March 4.

Protesters in early February emptied out kegs of draft beer on the street outside the Public Health Ministry. A ban on alcohol sales in bars and restaurants imposed the previous month in response to a surge in coronavirus cases was forcing brewers to dispose of unpasteurized brews with a limited shelf life and no buyers.

That came on top of strict regulations that make the industry inhospitable for upstarts seeking to challenge the duopoly of Thai Beverage and Boon Rawd Brewery, the companies behind the Chang and Singha brands, respectively.

During the first wave of the outbreak in April of last year, the government barred the sale of alcohol not only in restaurants, but also via retail, in an effort to discourage prolonged gatherings that could spread the virus.

But in contrast, the second wave that began late last year started with a cluster of cases linked to a seafood market near Bangkok.

"The spread of the virus is not from drinking," Achirawat Wansrisawat, chairman of the Craft Beer Association of Thailand, argued last month as he urged the government to relax the alcohol restrictions.

The restaurant ban was lifted Feb. 23 as the outbreak appeared to subside, but craft breweries still face an uphill battle. ThaiBev and Boon Rawd together control more than 90% of Thailand's beer market and dominate retailers' shelves, leaving little room for independent competitors.

And the country banned online sales of alcohol in December, citing concern about underage drinking as that practice rose amid the pandemic.

That "has closed a sales channel for craft beer, making it even harder to compete with the big companies," a wholesaler said.

Microbreweries face legal barriers in production as well. Thai law defines small-scale brewers as those producing between 100,000 litres and 1 million litres of beer annually, in effect requiring even the smallest players to sell the equivalent of at least 300,000 330-milliliter cans every year - too tall an order for many.

Some companies instead handle brewing in neighboring countries such as Vietnam and Cambodia, then import their products into Thailand.

Beers touted as "Thai originals" are lined up on supermarket shelves, but carry paper labels on top of each can marking them as imports. These brands also tend to be more expensive than domestically produced counterparts, due to the extra transportation and customs costs.

Some observers argue that these rules serve to shield the "big two" at the expense of competition and industry development.

"There are many forces behind the scenes in Thailand that protect vested interests," says Taopiphop Limjittrakorn, a lawmaker in the opposition Move Forward party and a maker of craft beer who was arrested in 2017 for illegal home brewing.

Taopiphop is calling for changes to the law, including the production quotas, to make it easier for small players to operate.





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