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Rising barley costs could mean higher prices for beer, analysts say |
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Before making a beer run, lager-lovers may soon need to start searching suds-soaked sofas for a few more dollars and cents thanks, in part, to the rising cost of barley.
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Production numbers are down and costs are up for the grain, one of several used to make beer. Combined with soaring energy costs and the high cost of other raw materials, like aluminum, analysts caution those extra dollars and cents may soon be passed along to consumers.
In fact, several breweries are already raising their prices due partially to raw material costs. Anheuser-Busch Cos. of St. Louis is planning a price increase for early this year, and earlier this month, Mexican brewing and bottling firm Femsa said it will raise beer prices to recover the higher costs of aluminum, glass bottles and barley and to keep up with inflation.
Those price increases are not always felt in consumers' pocketbooks. Distributors and retailers frequently eat the costs themselves. But with prices shooting up quickly, that could soon change.
"Raw material costs have gone up so much in such a short period of time, it's unavoidable that you will see some price increases eventually," said Morningstar analyst Matthew Reilly.
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Source - International Herald Tribune
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