Chinese beer prices rise with resource costs

05 January, 2018

Chinese beer brands have boosted prices in a reaction to higher resource and labour costs, lead by Tsingtao Brewery Co.

This increase in costs, reported by Beijing News, has boosted the stocks of Chinese beer brands by up to 23%, the highest rise in more than a decade.

Tsingtao confirmed with Bloomberg that it plans to raise its beer prices by an average of 5% in a reaction to the Chinese middle class demanding more premium beers.

Hong Kong-based analyst Jennifer So, told Bloomberg that it may be the first time in 10 years that Chinese beer brands have raised prices collectively.

“Breweries hadn’t been able to raise prices in the past few years due to competition from foreign peers,” said So. “The price increases and change in competitive landscape as they move up to higher end products should bode well for their earnings this year."

China remains the largest consumer of beer globally after taking over the US in 2001, and now drinks a quarter of all beer brewed around the world.

Keywords: Tsingtao

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