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Date Published: 08/09/2022

ARCHIVED - Drinking Spain dry: bar owners fear a winter beer shortage

ARCHIVED ARTICLE

Beer in Spain recorded an inflation of 7% in July as breweries run low on stock

<span style='color:#780948'>ARCHIVED</span> - Drinking Spain dry: bar owners fear a winter beer shortage

Beer is by far and away the most popular alcoholic drink in Spain, easily surpassing wine. In 2021, more than one million litres were consumed, an average of 22.7 litres per person. As with virtually every other consumer product, the cost of beer is escalating and breweries have already served bar owners with two price hikes this year: one in January and one in June.

So far, this probably hasn’t affected customers too much, perhaps a few cents here and there, since most bar owners have simply absorbed the price increases. However, this isn’t a long-term solution and another major problem looms large on the horizon: a shortage of CO2.

Essentially, CO2 is used in all carbonated drinks to give them their ‘fizz’, from cola to beer, but the gas, which is made in fertiliser factories, has been in short supply since the Ukraine invasion. Soaring natural gas prices due to sanctions imposed on Russia prompted several large fertilizer plants in the UK, Poland and Norway to halt or drastically reduce output in August, to the point that Carlsberg Polska threatened to stop production altogether.

Given that the price of beer has already risen 7%, it’s worst inflation in two decades, a CO2 shortage spells disaster, and industry insiders fear that in the very near future, breweries in Spain will run out of stock and barrels will run dry.

"There are two options, either to limit production or to raise the price, and both have an impact on sales figures and on the market," explained Eduardo Irastorza, professor at the OBS Business School.

Sources from one of the largest Spanish breweries confirmed that there is already a lack of stock: "We are having supply problems. We ask for a series of units and fewer are arriving."

For smaller bar owners, like José from Bar Hermanos Guío in Madrid, the outlook is bleak: running out of beer could mean having to close the doors, but charging more for a pint could also drive customers away.

"If prices continue to rise, we will have to close," he concluded grimly.

Image: Flickr

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