Higher beer prices on tap as summer approaches
Last Updated: Monday, May 5, 2008 | 2:41 PM AT
CBC News
The rising cost of malt, which has almost doubled in prices since last fall, is expected to drive up the cost of beer this summer. (CBC)Independent Canadian breweries are warning consumers that the cost of pouring a pint may soon rise, due to soaring malt and hops costs, as well as gasoline price hikes.
"There's a little bit of fear out there now about what's happening and what's coming next," said Peter Bulut Jr. of the Toronto-based Great Lakes Brewery.
Malt has almost doubled in price since last fall, increasing from $450 a metric tonne to $800. Hops and barley costs are also on the rise and breweries are contending with high gasoline prices in bringing their product to market.
Rising grain and energy costs have driven up the price of food around the world, swelling grocery bills.
Bulut says his brewery experiments with different varieties of hops and malts in small quantities. He says his company doesn't enjoy the same benefits as larger breweries that have long-term contracts — which cushion price hikes — with suppliers.
"Most brewers don't like to raise the price in the summer because that's their busiest time and they don't want to appear like they're gouging the consumer, but I think this year we won't have a choice," he said. "I think it's going to end up being in about a month — less than two months I would say."
Malt prices 'quite a hit'
Similarly, Greg Nash, the brewmaster for Moncton's Pumphouse Brewery, says the beer drinkers should brace themselves for higher bar tabs.
"[The high malt prices have been] quite a hit for us, but it is what it is. We have to keep making beer," he said.
"Sooner or later, [it's] going to catch up to us and I think it's going to happen with all the breweries locally. All the beer prices on the shelf I think are going to go up across the board — it's sort of surprising to me that we haven't seen it already somewhat."
Meanwhile, Toronto-based Steamwhistle Brewery expects prices to hold steady until next year.
"If things continue the way they're going now, probably in the new year in 2009 we may have to look at increasing prices a bit," he said.
In April, the Prince Edward Island Liquor Control Commission announced plans to raise the price of beer as of May 1, citing increasing costs for malt, glass, water, fuel and electricity. The new retail price for domestic beer is $20.25 a dozen, up 54 cents.
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