Just like neighboring Germany, Poland’s beer industry is reeling, with slightly different factors at play in the Polish market contributing to the decline.
“The beer season that just ended was disappointing. Unfortunately, in the first half of the year, we saw a decline exceeding 6 percent,” said Bartłomiej Morzycki, director general of the Union of Brewing Industry Employers – Polish Breweries.
“The summer months brought no improvement, and in fact, deepened the decline. It was the weakest season for the brewing industry in a very long time,” Morzycki continued.
Among the causes, he noted “exceptionally unfavorable” weather
As well as “broader issues” with the alcohol market overall, namely, lower alcohol consumption, he told ISBnews, as cited by Do Rzeczy.
“For some time now, we’ve been observing a steady trend of reducing alcohol consumption among large groups of consumers. Some are giving up alcohol altogether, while others are limiting their consumption,” Morzycki told the portal.
The trend is not simply due to health concerns but also the cost of alcohol, which, in the face of rising prices and a slower economy, many now see as quite expensive.
“Paradoxically, salary statistics might suggest that purchasing power is increasing and that the average salary can buy more beer, but this remains purely theoretical. In practice, consumers are buying significantly less,” he emphasized.
“The summer season is behind us, so since the market didn’t recover then, it’s difficult to expect a significant change at the end of the year. This will likely be the deepest market decline, greater than in 2023, when we were struggling with the effects of high inflation,” he pointed out.
Meanwhile, sales of non-alcoholic beer are growing at a double-digit rate, but this has done little to help offset the decline in sales of alcohol.
He noted that the biggest challenges facing the industry today remain the implementation of a deposit-refund system, which requires a significant investment and organizational effort, as well as the intensification of the debate surrounding alcohol policy.
“We still haven’t given up hope of saving the current deposit-refund systems for returnable bottles, which are effective and should never be incorporated into the system for disposable packaging. Under the new regulations, such bottles are no longer profitable. The system disrupts the current circulation chains for these bottles, and as a consequence, they may be forced out of the market because producers will have no incentive to use this type of packaging,” the director said.
Morzycki took aim at various proposals for higher taxes, which he says has created an atmosphere of “chaos” surrounding the alcoholic beverage market.
One proposal, he claims, even seeks to ban the advertising and sale of non-alcoholic beer.
He also noted the deposit refund scheme. Rising production costs, which have caused average beer prices to jump by about 45 percent over the past four years, have slowed somewhat. But the excise and deposit tax are still a problem. Morzycki estimates the excise tax will add some 20 groszy per can or bottle of beer, while the deposit will add an additional 50 groszy. The deposit tax can be refunded later, “but the customer will perceive the beer to be more expensive at the time of purchase. And this only applies to beer, as alcoholic beverages in disposable glassware are not covered by the deposit,” Morzycki concluded.
Given the current challenges and the risk of further ones, he says there is a high chance some breweries will not survive.
“Unfortunately, considering the above risks – and I’ve only mentioned some of the emerging ideas – even partial implementation could prove disastrous for a large portion of the beer market,” he told ISBnews.
“For example, when it comes to excise tax, if the government’s proposed increase is implemented, we’ll have a rate at the same level as Denmark. The beer excise tax in Poland is already significantly higher than in Germany or the Czech Republic, and we’re starting to see beer imported from those countries. This means consumption is occurring here, but taxes and jobs remain abroad. As a consequence of such a policy, the slow disappearance of breweries will be a reality,” the director stated.