NBL increases beer prices amid surge in input costs

 Namibia Breweries Limited (NBL) is set to increase the price of its beer products with effect from next month amid a surge in ingredients, energy and transport costs, a position attributed to volatility in global source markets.

The price adjustment will range between 5% and 14% effective 17 October, 2022 on selected SKUs (different packages) of the following brands in the NBL portfolio: Tafel Lager, Tafel Lite, Tafel Radler, Windhoek Draught, Windhoek Lager, Windhoek Non-Alcoholic, King Lager, Hansa Draught, Strongbow Cider.

“Current events and factors playing out globally have put enormous pressure on the input costs of Namibia Breweries Limited’s (NBL) business during 2022 to date. At NBL, we know and appreciate that our consumers are feeling the impact of escalating costs, and as such, NBL is continuously exploring various ways to absorb rising input costs by re-evaluating efficiencies and cost-saving opportunities within our own business. Unfortunately, current quantified and known input cost pressures within the entire NBL supply chain, which include raw-and-packaging materials procured beyond our borders, limit our ability to absorb all the cost increases experienced over recent months. We are thus unfortunately left with no viable alternative but to pass on some of these increases,” the brewer said.

The firm, had previously cited the price of raw barley, which is processed into its major ingredient, malt, has risen sharply due to the ongoing Russia and Ukraine conflict.

Through the malting process, raw barley is converted into malt, the raw material which NBL requires for the brewing process, being the source of the sugars (principally maltose), which are fermented into beer.

Although NBL does not source its barley from Ukraine, demand for malt has surged significantly worldwide resulting in high prices.

Uncertainty about the length and impact of the war has created volatility in markets and thus driving price increases.

In the financial year ended 30 June 2022, NBL’s net revenue increased by 14.1% to N$ 3.021 billion, a position it attributed to a growth in volumes to South Africa, a 35% increase in royalty income from Heineken SA, as well as price increases taken in the local market.

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Last modified on Saturday, 01 October 2022 14:12

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