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Europe/Russia

09 September 2022

Beer production in Ukraine drops by a third in January-July period

Ukraine | Domestic beer production (until end of July 2022) declined by 32 percent over the same period last year to 7.1 million hl, according to industry body “Ukrpivo”. Beer production recovered during the second quarter, after a massive drop of 50 percent in the first quarter.

The decline in output would have been exacerbated by the discontinuation of beer exports to Russia and Belarus. Third-ranked brewer Obolon alone must have lost hundreds of thousands of hl, insiders say.

In 2021, before Russia’s invasion, Ukraine produced 17 million hl beer. AB-InBev-Efes led the market with a share of some 30 percent, closely followed by Danish brewer Carlsberg.

Logistics are badly affected

Despite the fighting, beer production has continued, even though many breweries had to stop distribution and resort to cash and carry. From what we hear, plenty of trucks have been requisitioned by the army.

The three breweries owned by the AB-InBev-Efes joint venture have been shuttered since the beginning of the invasion. Carlsberg has meanwhile reopened all of its three breweries (Kyiv, Zaporizhzhya and Lviv).

Anadolu Efes said on 11 August it hopes to resume operations at the Chernigiv brewery soon, which is located north of Kyiv and at a safe distance from the current theatre of war in the east. In the meantime, it will supply the market with imported beer. In May, the joint venture still had stock sitting in its warehouses, a spokesperson told the website forbes.ua. At least, its products were not disappearing from the shelves.

Gaps on shelves

Unlike Coca-Cola’s. In May it was not easy to buy Coca-Cola products. Production had to be halved after the Coca-Cola plant in Bolshaya Dymerka near Kyiv suffered from shelling and was under Russian occupation for almost a month. It may have been looted too. In order to provide more than 100,000 outlets with at least the company's flagship brand, Coca-Cola began importing its beverages from the Czech Republic and Poland.

Although Western firms are keen on resuming local production, it will be a challenge. The process of reopening a plant is multi-stage and depends on many factors. “For example, just testing water for production can take up to two weeks,” a spokesperson for Coca-Cola Beverages told Ukrainian media.