2020 was a difficult year for the global brewing industry. While estimates vary, there is general agreement that world beer production was down between 7-10% this past year. Certain regions were particularly hard hit such as Africa, Asia and Europe with output drops in the order of 10-15%, while North and South America fared better with production down 2-5%. In China, the world’s largest brewer, production is estimated to have fallen by 8-10%, or 30-35 million hectolitres. To put that in perspective, total Canadian beer production is around 20 million hectolitres. In Japan, beer sales reportedly dropped 9% in 2020, while in Vietnam beer production is estimated to have fallen 14%. Mexico, which shuttered breweries for over 2 months during the April-June period last year, saw a production drop of about 5%.
Europe was also hard hit with production estimated to have fallen overall by 9%. In contrast, the impact on total beer output in Canada and the United states was less pronounced with production estimated to have fallen by only 2-3%. A dramatic increase in retail sales in the U.S. and Canada made up for a substantial portion of the drop in on-premise sales, sales at concerts and sporting events etc. This resulted in a major increase in sales of canned, and to a lesser extent bottled, beer (leading to a shortage in aluminum cans) although there was a corresponding dramatic drop in keg sales. In Canada, beer sales volumes dropped by less that 1% in 2020 compared with 2019 according to Beer Canada data.
Looking forward, the recovery in 2021 has already begun in many parts of the world. China’s beer production is estimated to have recovered to close to pre-pandemic levels already, and similarly in Europe things are improving. However the consensus is that in many countries, 2021 will be a year of gaining back sales lost in 2020 to return to 2019 levels as opposed to a year of growth. As one malting industry representative commented recently, while we haven’t turned the corner yet, at least we can see it.