NBWA: May Beer Purchasers’ Index Shows ‘Good Signals’ For Summer Beer Sales
The beer industry is on track to have a strong start to the summer selling season, according to the National Beer Wholesalers Association’s (NBWA’s) May Beer Purchasers Index (BPI).
The total beer category posted a reading of 53 last month, while inventory “at-risk” of going out of code posted a reading of 46. A reading above 50 indicates expansion, while a reading below 50 indicates contraction.
While there’s “nothing particularly exciting in these results,” that may be a “good sign,” the NBWA noted, as it suggests the industry is “settling down from the supply and demand shocks over the past 24 months.”
“These results also show a steady improvement over the first quarter, with both April and May reporting a slightly higher ordering index along with a slightly lower ‘at-risk’ index,” the NBWA said. “Slightly higher ordering indices, combined with leaner inventory indices are good signals for June and the start of the summer beer selling season.”
Still, the category’s reading is below readings for the same month in 2021 (80) and 2020 (64).
While the total beer category expanded in May, imports were the only beer segment to post a reading above 50 for the mont., The segment’s reading of 71 was slightly higher than its May 2021 reading of 68.
The FMB/hard seltzer segment contracted again, with a reading of 37 – a stark contrast to the segment’s May 2021 reading of 82, which outperformed all other beer segments at the time.
Premium lights posted a reading of 48, contracting after a 52 reading in April. While the reading is significantly below the segment’s May 2021 reading of 64, it is “in line with recent historical trends,” according to the NBWA.
Similarly, premium regular contracted with a reading of 37, below its May 2021 reading of 48, “returning to its long run averages.”
Craft contracted again, with a reading of 37, below its May 2021 reading of 65, and closer to the segment’s May 2020 reading of 42.
Below premium posted a reading of 40,compared to 36 in May 2021. Cider posted a reading of 31, below its May 2021 reading of 46.
April 2022 Domestic Tax Paid Shipments -5.9%
U.S. brewers shipped 13.7 million barrels in April 2022, a -5.9% decline compared to April 2021’s shipments of 14.557 million barrels, according to the Beer Institute, citing the latest domestic tax paid shipment estimates shared by the Alcohol and Tobacco Tax and Trade Bureau (TTB).
Jefferies equity analyst Kevin Grundy wrote that April’s declining shipments were in part due to difficult year-over-year comps (+8% in April 2021), less benefit from hard seltzers, which were up +30% in April 2021), and normalized inventories compared to the previous year. “Improving demand trends and easing supply chain pressures (+) for industry,” he added.
Domestic tax paid shipments have now declined in three of the first four months of 2022. Year-to-date through April, U.S. brewers have shipped 52.3 million barrels, a -3.6% decline compared to the same time in 2021 when brewers shipped 54.225 million barrels (-1.925 million barrels).
March 2022 bucked the negative trends, increasing shipments +2.9%, to 15.2 million barrels. Shipments declined year-over year in January (-6.2%, to 12.3 million barrels) and February (-5.8%, to 11.1 million barrels).
Estimates for May 2022 are expected on June 29.
Meanwhile, the BI also shared data for state shipments to wholesalers for April 2022 that showed a -4.1% decline, to 16,786,301 barrels, compared to April 2021.
Danelle Kosmal, BI VP of research, wrote that “shipments from importers are offsetting some of the declines from domestic brewers.”
In April, Texas recorded some of the steepest declines at -9.6%, but remains up year-to-date (+2.9%). Other states experiencing declines in April include Ohio (-13%), Pennsylvania (-8%) and New York (-6%).
Overall, state shipments year-to-date are down -1.4%, to 62,972,217 barrels.
Numerator: Beer the Choice of 75% of Consumers Planning to Buy Alcohol for Memorial Day
Ahead of the Memorial Day holiday, data firm Numerator reported that 75% of consumers who plan to purchase alcoholic beverages plan to buy beer, followed by wine (44%) and spirits (40%).
According to Numerator’s survey, 75% of consumers plan to celebrate Memorial Day. However, not all is rosy, as 79% of respondents said they expect inflation to affect their celebrations.
Overall, 73% of respondents said they cut back on spending, and 74% will buy fewer items due to inflation.
The survey found that 33% of consumers expect a major inflationary impact on their celebrations, with lower income consumers 42% more likely to expect a major impact, and half not likely to celebrate this year.
So what are consumers cutting back on? Nearly half (49%) said they’d cut back on dining out, while 44% will skimp on decorations and 31% will cut back on alcohol and apparel.
Travel is also getting cut back, with 27% of consumers planning to stay put, and 20% saying they’ll travel shorter distances this year.
As for COVID, 59% of consumers surveyed said they don’t expect the pandemic to affect their celebrations.