Price of a pint of beer set to rise as pubs struggle with costs

05 April 2022 by
Price of a pint of beer set to rise as pubs struggle with costs

Pubs and brewers have warned the price of a pint of beer could see another significant increase by the New Year due to the soaring costs of energy and barley.

Some large chains have already raised drinks prices by between 10p and 45p and warned customers could see further increases towards Christmas.

Fergus Fitzgerald, director of production at Suffolk-based brewer Adnams, told The Caterer the industry was in "uncharted territory" to be contemplating a second price hike this year.

Part of the cost pressure has been driven by the Russian invasion of Ukraine, which is the world's third largest producer of barley. Global prices of the grain have risen by around 30% since the conflict began in February.

This has prompted a warning from Adnams that the cost of beer could jump again in 2023 due to the impact on this year's harvest.

At the same time manufacturers are being hit with energy surcharges that are being passed on to hospitality customers.

Fitzgerald said: "Suppliers have come back and said they need to raise the agreed prices, or they'll face a loss. We've never seen that before.

Fergus Fitzgerald, head of production at Adnams
Fergus Fitzgerald, head of production at Adnams

"Most brewers will have secured the barley they're going to use this year. It's about the supply for next year's brewing, and those prices are quite a lot higher than they would have been about a year ago."

Adnams has had to hike prices by an average of 5.5% this year and Fitzgerald warned this could rise further in the next eight months. "In a normal year we would not even be contemplating another price rise until next year," he said.

Pubs raise beer prices

The average cost of a pint of beer in the UK is £4.07, according to the British Beer and Pub Association.

JD Wetherspoon said last month that it had raised its prices by around 10p on average, with an extra 20p added to drinks in its London venues.

Marston's, which operates more than 1,500 pubs, has also raised drinks prices by between 20p and 45p, blaming "soaring energy prices and operating costs".

Sacha Lord, night time economy adviser for Greater Manchester, forecast the average cost of a pint could rise 5% to around £4.25 by June.

"Most [landlords] will try to keep price increases lower than the current 6.2% inflation rate to keep customers coming in and will look to cut costs elsewhere such in their supply chains or even by reducing trading hours and cutting staff hours," he said.

Fitzgerald added that while the cost of ingredients would continue to rise, there was little threat to the overall supply from breweries. "The upside is there will still be beer, it might be a little bit more expensive, but there will still be beer," he said.

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