Sales of beer return to growth in 2014, Mintel reports

craft beer co

Sales of beer in the UK are expected to have returned to growth this year, boosted by a warm summer and the World Cup, according to new research from Mintel.

Volume sales are on course to have increased by 1.3% during 2014 to an estimated 4.24 billion litres after a five-year decline of over 500 million litres between 2009 and 2013.

Lager continues to drive the market, with volumes sales for 2014 set to have risen by an estimated 1.7%, up to 3.17 billion litres.

Ale sales are also growing, up by nearly 1% from 885 million litres to an estimated 891 million in 2014. However stout sales continue to slide, predicted to fall to 183 million litres in 2014.

Chris Wisson, senior drinks analyst at Mintel, said: “Pressures on household finances, health concerns and competition from other markets have led to significant volume sales decline over the past five years for the beer market.

“However, 2014 has seen volume sales finally bounce back into growth, buoyed by a warm summer and the football World Cup.

“Whilst much of the market’s recent value growth has been driven by inflation and the now-defunct beer tax escalator, successive 1p cuts on the tax on pints and the slowdown in the cider market bode well for beer’s improving fortunes.”

According to the Mintel research, over half (54%) of Britons drank lager in the six months to September 2014 while a quarter (26%) opted for ale and one in five (21%) drank bitter.

One in five Britons (20%) have drunk craft beer in the past six months, rising to almost a third (31%) of people aged 25 to 34 and 24% of those aged 18 to 24.

Craft still seems to be driving premiumisation in the category as a third (34%) of beer drinkers say they would be prepared to pay more for craft beers, rising to 43% among 25- to 34-year-olds.

However, Mintel’s research also shows that over a third (36%) are unsure what the term “craft beer” actually means. It suggests there is scope for education as 31% say they would like to understand more about beer, for instance how to serve it and the ingredients used.

Chris added: “Whilst craft beer is often defined on grounds of volume production, the segment has instead come to encapsulate an ethos and benchmark for producing high-quality or different types of beers.

“Rather than just stating that they are a craft beer, brewers should clearly state how they justify this positioning, for example via their small production batches or use of unique or interesting ingredients.”

Volume sales of cider are expected to fall by 0.8% to 949 million litres in 2014, down from 957 million litres in 2013. However, value sales are expected to grow by 1% in 2014, rising to £3.05 billion. Mintel pointed out that this was in stark contrast to the robust growth the category experienced in previous years, with value sales rising by 10% in 2012 and 6% in 2013.

Mintel’s research shows that 57% of UK consumers drank cider in the 12 months to October 2014, with more than two in five (44%) drinking apple, 31% pear, and 29% fruit-flavoured cider.

The craft segment is considerably less developed in cider than it is in beer, but 14% of Britons still reported to have drunk a craft cider within the last year.

Chris said: “Despite the significant recent growth of the cider category, volume sales are surprisingly estimated to dip slightly in 2014. Some of cider’s momentum appears to have been lost to a rejuvenated beer category, which is seeing strong growth from various segments such as craft and world/global beers.”

While retail value sales of apple cider are expected to dip by 1% in 2014, pear is estimated to have plummeted by 29%. In contrast, fruit-flavoured ciders have soared, rising by just over a third in value.

“Fruit-flavoured cider benefits from being seen as a fashionable and innovative segment of the market, two attributes which have been key in driving growth by appealing to millennials in particular.”

Picture: The Craft Beer Co, which grew to six sites in 2014.

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