Domestic sales January - June 2004: Beer sales increased by intense price competition

Press release 2 August 2004

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

Beer sales increased by intense price competition

Domestic sales by members of the Federation of the Brewing and Soft Drinks Industry showed an increase of 1.6% during the first half of 2004 compared to the year before. This increase was primarily due to sales of medium-strength beer, which were boosted in particular by notable special offers in retail shops before Midsummer. Beer sales grew 6%. Also, sales of mineral waters were up 7.6% by the end of June. However, sales of soft drinks fell by 5%.

Sales by members of the Federation of the Brewing and Soft Drinks Industry totalled 407.2 million litres between January and June. Total sales climbed to 6.4 million litres, up 1.6% from the corresponding period last year.

Despite the cold summer weather, beer sales rose by 6% by end June. The growth came solely from sales of medium-strength beer in retail shops. Significant declines were experienced both in strong beer sales and beer sales in restaurants. Especially before the Midsummer holidays, medium-strength beer was sold at bargain low prices in order to attract customers to the stores. In total, domestic beer sales reached 204.6 million litres by end June, which is 11.5 million litres more than in the corresponding period last year.
Sales of cider amounted to 21.1 million litres, which was 0.6 million litres less than last year. Long drink sales, on the other hand, experienced an increase of 0.5 million litres, totalling 11.6 million litres. The growth was due to the increase in strong long drink sales in state alcohol monopoly shops. In retail shops, the sales of long drinks declined.

Mineral waters continued to enjoy strong growth. Sales of mainly carbonated mineral waters totalled 31.4 million litres in the first half-year period, up 2.2 million litres from the year before. This is a growth of 7.6%. Moreover, Finns consumed 138.6 million litres of soft drinks, which is 7.2 million litres less than in the spring of 2003.

DOMESTIC SALES JANUARY - JUNE 2004

Beverage	2004 mill.l	2003 mill.l.	Change mill.l.	Change %
Beer	204.6	193.1	11.5	6.0
Cider	21.1	21.7	-0.6	-2.9
Long drink	11.6	11.1	0.5	4.7
Soft drink	168.6	145.8	-7.2	-5.0
Mineral water	31.4	29.2	2.2	7.6
Sales total	407.2	400.8	6.4	1.6

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.

As a result of the price competition, the extremely low domestic beer prices have so far been able to curb excessive private imports from Estonia. Fickle summer weather has not been favourable to cruise travel either. However, it can already be observed that the amount of beer imported by passengers has significantly increased per person. It is likely that the total amount of beer imports has also risen after the beginning of the summer holiday season. The price competition cannot last very long. A permanent and clearly necessary price-cut can only be achieved by further lowering the beer tax. Stable prices would calm the domestic beer market and prevent the increase of private imports. The Finnish brewing industry employs indirectly over 30.000 people.

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.