Australian breweries in 2020: keeping spirits high

Australia | As can be expected, the coronavirus crisis will have impacted brewers’ sales adversely, but insiders are hard pressed to come up with an estimate. Most likely, beer sales will be down in the mid-single digits in 2020, but the decline will probably hit the Big Brewers harder than the independents.

No data is available on how international beer brands have fared, but evidence from Coopers suggests that sales of international beer brands, both brewed locally and imported, dropped during the first national lockdown. Also lacking is insight into how supermarkets’ private label brands have performed so far.  

From what we know, industry sales dropped 5 percent for the year ended June 2020. The June quarter was the most dramatic, with sales volume down over 20 percent (April, May and June compared to the same months in 2019).

Sales keep up but what about profits?

Craft brewers seem to fared surprisingly well. No news of any brewery closures has reached us yet. In fact, many independents are producing at full capacity, even in the state of Victoria, where Melbourne, as of July, was put under another lockdown, which was revoked at the end of October only. Obviously, craft brewers could sell as much beer curb-side as they previously did over the bar in their taprooms.    

However, market research firm IBISWorld expects revenue for the craft brewing industry to have shrunk by 6.6 percent in 2019-20. While industry revenue is anticipated to increase 4.5 percent in 2020-21, this growth rate is relatively slow due to declining consumer spending power, IBISWorld says in a report.

Even if the overall decline in volume sales appears small, insiders fear for industry profits, as brewers large and small depend on keg beer sales for the bulk of their profits.

Fortunately, the Federal Government has launched several stimulus packages designed to keep smaller firms in business and their employees in a job.

Read more about how "Australia’s indie brewers benefit from shift in people’s drinking habits" and how "Australia’s Coopers breweries sees sales rise during lockdown".