Beer prices on the rise

3.30pm - By KATHERINE HOBY

Beer prices could rise by about "a dollar a dozen" tomorrow.

The annual excise tax adjustment - this year sitting at 2.5 per cent - and a decision by DB and Lion Nathan breweries to raise wholesale prices means consumers may be paying 5 per cent or more for their favourite brew.

Kamo Super Liquor owner/manager and Super Liquor Holdings board chairman Vince Stead said in round figures the price rises would mean "a dollar more a dozen".

Based on prices for beer specials at Kamo Super Liquor, a pack of 24 Lion bottles would rise from $29.99 to $31.99 and a pack of 24 Export Gold bottles would rise from $27.99 to $29.99.

Hospitality Association chief executive Bruce Robertson said some [beer retailers] might try to absorb all or some of the increase but on the whole, "consumers can expect to be paying more for their brew".

He said the association would recommend to its members that they increased prices.

The breweries say "significant" rises in raw material and distribution costs are to blame for the price rise.

Lion will increase its prices for tap and packaged beer by an average 4.9 per cent, and DB by 4.2 per cent. The rises includes excise tax.

Julian Davidson, managing director Lion Breweries, said malt prices had increased by 20 per cent, distribution costs including petrol prices had jumped, the price of hops had gone up 10 per cent, and packaging almost 10 per cent.

DB Breweries general manager of sales and marketing, Rene van der Graaf, said due to increased raw material and distribution costs, the brewery would increase its wholesale prices.

Mr Robertson said he was disappointed the government did not absorb the increases rather than "whacking the consumer again with an enjoyment tax".

"Margins are tight and while it's a competitive industry, those businesses that aren't passing on those increases are simply putting their businesses at risk," he said.

"The retail sector has had ongoing increases - electricity, significant increases in insurance costs since September 11, and of course movements in wages," he said.

"What individual retailers will apply is up to them but if you are going to increase prices you only want to do it once."

A spokesman for a major liquor chain who did not want to be named said some outlets would definitely be increasing prices more than 4.9 per cent.

"As retailers we find it very hard to recoup costs," he said.

"All the retailer is doing is putting the same margins on, the same ones we need to survive. If you don't you go backwards."

Stephen Berryman, merchandise manager for Liquorland Limited said he expected a price rise of about 50 cents to a dollar on a dozen beer.

He knew of some retailers who had purchased a lot of stock in advance of the price rise so they could maintain stock prices to consumers for as long as possible. Others planned to pass costs on straight away.

He said some products and brands would be hit harder than others.

"In some there will be no change and on other products there will be an appreciable change."

Wine and spirits will also rise in price due to the excise tax increase.