AB-InBev to close third Russian brewery

A year of brewery closures? First, Efes closed their Moscow brewery in January, now AB-InBev follow suit. On 26 March 2014 media reported that AB-InBev will shut down their brewery in Perm. It will be their third plant to go off-stream in less than two years after closing one in Kursk in 2012 and another in Novocheboksarsk in 2013. This will leave AB-InBev with six breweries, it was reported.

This all proves to show how bad the situation in Russia has turned for western brewers. Toughened regulation of alcohol sales, coupled with tax hikes, and a ban on advertising and sales in kiosks have made the Russian beer market slump by more than 25 percent since 2008, creating excess capacity for most of the market players and forcing them to shut plants and rethink strategies.

AB-InBev’s Russian sales fell by 13.6 percent last year amid a broader market decline. The outlook for 2014 is not rosy either. Observers say Russian beer sales could drop again by mid to high single digits.