Beer getting more expensive
The cost of ingredients is going up, giving brewers little choice but to pass on the burden to customers.
Anheuser-Busch Inbev (BUD) says it will raise prices on many of its beers this fall, according to the St. Louis Post-Dispatch. "Increases will vary by brand and market," a company spokesman told the newspaper.
This was all but expected, given the increase in cost for the materials needed to produce beer. Chief executive Carlos Brito has said the price of ingredients is rising in the "mid-single digits," the newspaper reported. So it stands to reason that beer prices will go up by at least that much, but probably more.
Time Magazine suggests that it's time to stockpile beer before the price increase.
A beer industry trade publication, Beer Marketers Insights, said that some distributors in Florida were being warned of "pretty sizable hikes," according to the Post-Dispatch. Another publication, Beer Business Daily, reported possible price increases of 55 cents a case for Budweiser products and as much as 75 cents a case for the popular Bud Light Platinum and Bud Light Lime.
Anheuser-Busch isn't the only brewer raising prices. MillerCoors, the U.S. joint venture between Molson Coors (TAP) and SABMiller (SBMRY), said Tuesday that higher prices helped it achieve underlying net income of $436 million, excluding certain items, in the second quarter.
Anheuser-Busch has nearly 50% of the U.S. beer market, compared with nearly 30% for MillerCoors.
Big brewers have been pulling out all the stops this year to lure beer drinkers back after an alarming consumer shift to wine and spirits. Molson Coors has created an iced-tea beer called Coors Light Iced T. Anheuser-Busch is selling the Michelob Ultra 19th Hole Light Tea and Lemonade.
Both companies started looking at these alternative beverages after seeing the success that Boston Beer (SAM) has had with its Twisted Tea line.
More from Top Stocks
- Is this the rally?
- Can Best Buy founder save his former company?
- Is Buffett running out of opportunities?
The Big Smokescreen,
The increasing price of beer is just one of the literally thousands of everyday consumer items that have seen upticks of 5, 10 and 15% in the past year. Yes, some of it is due to overhead, materials and transportation costs etc, but much of it is also pure and simple greed on the part of the Fortune 500 corporations whose first allegiance is to their major stockholders and corporate boards. I certainly don't think it's because the grunt workers at those companies got huge pay increases like their CEOs.
Our 'purer-than-the-driven-snow' smokescreen of a federal government has a very nasty habit of continously putting lipstick on a pig by telling working Americans that the inflation is 'only' 2.5% or 3% or some similar annual figure .... wait a minute while I put on my pajamas so that these lying bureaucrats can tell me yet another bedtime story! Every single time I go to any store the price of everything has gone up from the last time I purchased it. If this weren't so sad it would be laughable.
Peace to all
This is to be expected from foreign brewers. INBEV and SABMiller are just milking the US to send their profits back to Europe to keep their prices down. Moslson, another foreign brewer, is doing the same for Canada. Other than a few specialty brewers, the US is no longer in the brewing business.
consumer is screwed again, what happens when consuption comes to a total halt because of too high prices then what are you going to tell your shareholders. pass it on to the consumer. pass it on to the consumer. pass it on to the consumer. pass it on to the consumer. pass it on to the consumer. pass it on to the consumer. pass it on to the consumer. pass it on to the consumer. pass it on to the consumer. Oops dead economy.
Bud and Coors SUCK! I love when we are at the pub and some idiot asks why they don't have any "domestics," instead of these microbrews. Uh, the microbrews are domestic and your crap coors and bud are internationally owned. These Macrobreweries are going to keep seeing decreases in their piss water sales as more and more local breweries pop up producing a MUCH more superior product.By them raising prices, it's just going to make their cost even with craft beer, and if I had to choose, craft beer it is, always! It's amazing that as American's we let these pathetic brands dominate the market for so long. Guess it is just a testament to all the white trash in country that eat fast food, drink budweiser/Coors light and buy "made in china" products from walmart. It would be a great day to see both these corporate BS macrobreweries go out of business as great beer cities like San Diego, Portland, and Philly continue to produce quality beer.
Copyright © 2014 Microsoft. All rights reserved.
New study finds members of this global elite are stashing an average $600 million each in cash -- 10 times more than a year ago.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.