Domestic sales January - September 2004: Domestic beer sales up 3%, total sales of beverages down

Press release 2 November 2004

Domestic sales by members of the Finnish Federation of the Brewing and Soft Drinks Industry 1 January  - 30 September 2004 

Domestic beer sales up 3%, total sales of beverages down

In January-September total sales of beer, cider, long drinks, soft drinks and mineral waters in Finland were 2.1% lower than the year before. The cool and rainy summer depressed sales of soft drinks and mineral waters. On the other hand domestic beer sales in January-September were up 3.0% compared with the year before. According to research, private imports of beer have at least doubled. Without promotions in shops, private imports would be considerably higher. Private imports of beer will total 50-60 million litres in 2004, purchased mainly in Estonia and on ships.

The members of the Federation of the Brewing and Soft Drinks Industry sold 624.7 million litres of beverages in January-September. This was 13.4 million litres less than the year before. Beer sales totalled 313.6 million litres during the same period. Sales of medium-strength beer rose but sales of strong beer fell by 9.7%. Promotions in supermarkets increased domestic sales of medium-strength beer. Beer sales through shops rose by 8% or 17.1 million litres, but sales in restaurants fell by 7.8% and sales through state monopoly Alko by 12.8%. In spite of promotions, private imports of beer from Estonia, which joined the EU last spring, have increased strongly.

Cider sales totalled 32.7 million litres in January-September. This was 2.9 million litres less than the year before. Long drink sales fell by 2% and totalled 18.7 million litres.

Sales of soft drinks in Finland totalled 210.9 million litres in January-September and sales of mineral waters totalled 49.2 million litres. Both figures were down, with sales falling by 7.6% for soft drinks and 4.3% for mineral waters.

DOMESTIC SALES JANUARY - SEPTEMBER 2004

Beverage	2004 mill.l	2003 mill.l.	Change mill.l.	Change %
Beer	313.6	304.4	9.2	3.0
Cider	32.7	35.4	-2.9	-7.6
Long drink	18.3	18.7	-0.4	-2.0
Soft drink	210.9	228.3	-17.4	-7.6
Mineral water	49.2	51.4	-2.2	-4.3
Sales total	624.7	638.1	-13.4	-2.1

Source: Member companies of the Federation of the Brewing and Soft Drinks Industry. The statistics do not include sales by actors outside the Federation, nor private imports of brewery products, which are not statistically recorded.

Doubling of private beer imports following removal of import quotas
TNS Gallup has monitored private imports of beer since May in two-week periods. The results indicate that private beer imports will at least double this year. Private imports of beer will total 50-60 million litres in 2004, purchased mainly in Estonia and on ships. Private imports of cider will total about 6 million litres and private imports of long drinks over 4 million litres this year. Figures may be even higher than this, since respondents tend to underestimate their alcohol imports.

Beer promotions in shops cannot continue forever. Beer sales with unhealthy margins are unsustainable at least for breweries. When prices in Finland rise, the feared outcome is a rush to buy cheap beer in Estonia. Operational models have been developed and import capacity exists and has been tested. If imports remain at the same level year round as in the summer of 2004, private imports of beer could reach 80 million litres. Beer tax should be lowered closer to the level in Estonia in order to calm the market and provide companies a price structure that ensures proper operating conditions.

Additional information:
Communications Manager Katri Tuulensuu, tel. +358 (0)9 1488 7601, GSM +358 (0)40 777 1938
Managing Director Risto Saarinen, tel. +358 (0)9 1488 71

The Federation of the Brewing and Soft Drinks Industry promotes the interests of producers of beer, cider, long drinks, soft drinks and mineral waters in Finland. Its members are Oy Hartwall Ab, Nokian Panimo Oy, Olvi Oyj and Oy Sinebrychoff Ab. The Federation of the Brewing and Soft Drinks Industry operates in connection with the Finnish Food and Drink Industries' Federation and is among the three largest industries in the food and drink branch in terms of the value of production.