The “pessimistic outlook” for beer has continued through Q4 2022, after the category recorded its sixth straight month of contraction, according to the National Beer Wholesalers Association’s (NBWA) November Beer Purchasers’ Index (BPI).
Total beer recorded a reading of 38, after a 37 reading in October, the lowest of the year. A reading greater than 50 indicates expansion, while a reading below 50 indicates contraction.
At-risk inventory – beer at-risk of going out of code in the next 30 days – contracted in the month with a reading of 49, following a year-high reading of 56 in October, suggesting the middle tier is being more cautious with inventory levels.
The combination of the low total beer reading and lower at-risk inventory “are indicative of lower expected sales following fall price increases,” as well as “news of increasing layoffs and a general slowing of the U.S. economy,” according to NBWA chief economist Lester Jones.
Imports were the only beer segment to expand in the month with a reading of 59. While the segment continues to grow, that growth may be slowing down, as the reading is below the November 2021 reading of 68.
Below premium recorded a reading of 47. Although contracting, below premium “continues to be the only segment to report a higher reading over the 2021 indexes,” with a significantly higher reading compared to November 2021 (29), according to Jones.
The rest of the category recorded contraction:
- Craft with a reading of 25, compared to 47 in November 2021;
- Premium lights with a reading of 41, compared to 54 reading in 2021;
- Premium regular with a reading of 20, compared to 38 in 2021;
- Flavored-malt beverages (FMB) and hard seltzer with a reading of 16, compared to 31 in 2021;
- And cider with a reading of 28, compared to 32 in 2021.
BI: Beer Shipments Continue to Fall Below 2021, Down -5.3% YoY in October
U.S. brewers shipped an estimated 12.9 million barrels of beer in October, a -5.3% decline versus October 2021, according to the Beer Institute (BI), citing domestic tax paid estimates from the Alcohol and Tobacco Tax and Trade Bureau (TTB).
October marked the fifth month this year with a more than -5% YoY decline in shipments, along with January (-11.8%), February (-8.2%), April (-7.1%) and July (-5.5%).
March (+1.5%) and August (+2.4%) were the only months to record shipment increases versus 2021.
Brewers have shipped about 137,263,330 barrels year-to-date (YTD) in 2022 through October, a -4.1% decline YoY and more than 5.8 million fewer barrels than in 2021.
The November domestic tax paid estimate will be released on December 21.