Beer production in Italy confirms a growing trend compared to pre-pandemic data, but the sector needs concrete support to grow again. To strengthen the competitiveness of the sector, AssoBirra continues to dialogue with the institutions to reduce the excessive tax burden on the category and encourage investment.

A year of challenges and complexity, but also of resilience and adaptability. It can be summed up as 2023 of beer in Italy: twelve months that -despite the evident contraction of the market- have confirmed the solidity of the Italian brewing sector, able to keep alive its ability to reinvent itself with innovation and investment, but that today it needs concrete support from the institutions to return to growth. To photograph the state of health of the brassicolo segment is the Annual Report 2023 of AssoBirra, the most representative association of the brewing industry in Italy, which today presented the new edition in Rome, in the presence of the minister of Enterprises and Made in Italy, Adolfo Urso. 

"Beer is a sector of made in Italy that has developed especially in the last 20 years. A sector that is investing a lot in product innovation and that now increasingly supports, and completes, the offer of drinks that we already realize in our country. In this regard, I think it is important to remember what we did for Italian productions, and now beer is one of them, with the framework law on Made in Italy that is unfolding its effects on the artisanal and industrial fabric", said Urso. "The brewing sector -the minister continues- will also be able to strengthen and innovate further by benefiting from the 5.0 transition plan that combines for the first time in Europe digital, energy and environmental transition, with over 13 billion tax credits usable by companies in 2023-24. It will then be important to develop the appropriate skills: to this end, the measure provides that 10% of the resources can be used for staff training. It will be the most advanced plan in Europe to make Italian companies more competitive".

Many evidences emerged during the conference. In 2023 there was a drop in production (-5.02%), consumption (-5.85%), export (-5.36%) and import (-7.5%) of beer, clear signs of a sector that has suffered along the entire axis of the production, agricultural and distribution chain up to points of consumption and sales. In the first months of 2024 the downward trend seems to have stopped and, if the summer season were to mark a recovery, the long-term prospects would return positive because supported by the growth of the brewing culture and the solid reputation of the Italian brewing product, as evidenced by research and markets. 

AssoBirra actively dialogues with institutions and collaborates with other sector associations, in a continuous work of awareness and awareness of trends and factors that impact on the possibility of returning to growth, such as climate change, with the consequent increases and the difficult availability of some raw materials, the increased cost of energy and, last but not least, the inflationary push of all products, including large consumption. These factors have led to a reduction in the general purchasing power, particularly felt by the brewing sector because of the additional weight -compared to other meal drinks- of excise duties. This type of taxation is in fact part of the construction of the price of beer on the shelf, in bars, restaurants and pizzerias: a factor that therefore contributes to the contraction of the market, removing resources from businesses in the supply chain and thereby facilitating beer imports from certain low-tax markets.

The support requested by AssoBirra is, first, a path of structural reduction of excise duties to which beer is subject, to be able to confirm investments, and thus stimulate the recovery of the market, generating wealth for our country. The objective is to achieve a fairer fiscal policy, which will enable the players in the sector to innovate, continue sustainability plans and the use of advanced technologies, essential for organic, sustainable and long-term growth of the brewing industry. 

Therefore, it is crucial to address this issue by highlighting how excise duties adversely affect both the investment capacity of companies and the competitiveness of the sector. The brewing sector plays a central role for the Italian economy, capable of creating value and economic spin-offs and jobs: the sector occupies, in fact, over 100 thousand operators in over 1,000 companies (1,012 companies in the sector including breweries, microbreweries and malthouses)creates a shared value of 10.2 billion euros (equivalent to 0.54% of GDP) and, above all, -the only meal drink-, pays the Treasury over 700 million in annual excise duties that are added to the ordinary tax contribution. 

Beer in figures 

According to AssoBirra data, in 2023 beer production in Italy reached 17.4 million hectoliters, recording a 5.02% decrease compared to 18.3 million hectoliters in 2022, but exceeding the pre-pandemic levels of 2019 (17.3 million hectoliters) and almost equal 2021 (17.8 million hectolitres). Consumption, although down from the record of 2022 (22.5 million hectoliters), stood at 21.2 million hectoliters in 2023, marking a decrease of 5.85% but maintaining a share that exceeds the historic maximum of consumption recorded until last year (21.2 million hectolitres in 2019) and exceeding that of 2021, outlining an increase of over 20 percentage points (20.9%) compared to ten years ago (17.5 million hectolitres in 2013). The import of beer has similarly recorded a decrease of 7.55% compared to the previous year, equal to 600 thousand hectoliters, with 7.4 million hl compared to about 8 million in 2022. 

Germany -which enjoys a tax 4 times lower than that of Italy- remains the main country of origin of imports, with 41.7% of total imports, followed by Belgium (with a share of 20.7%), the Netherlands (9.8%) and Poland (9.4%). Among the non-EU countries, which account for a global figure of 2.2% of imports, the largest exporter to our country is the United Kingdom, with almost 95 thousand hectoliters on about 135 thousand of the total non-EU. Exports also show a lower aggregate than in 2022 (3.6 million hl in 2023, with a -5.36% compared to 3.8 of the previous year). The export distribution shows a decrease in the share to the United Kingdom (44.1% vs 48.2% in 2022, equal to -250 thousand hectoliters in 2022), but an increase in exports to Albania and especially France, with a growth of 57%. 

Among distribution and consumption channels the out-of-home returns, which in 2023 recorded a +1.8% compared to the previous year -in fact maintaining the same volumes, with total consumption slightly below 8 million hectoliters-partly offsetting the large drop in domestic consumption of the Gdo Canal, which had to deal with a strong elasticity of demand and the reduction in purchasing power.

The challenges of the sector 

In the current context, AssoBirra considers it essential to take certain positive decisions on the tax side, which will allow companies in the brewing industry to return to devote economic resources, generate sustainable growth over time and compete on international markets, today less slowed by taxation and bureaucracy and therefore more free to invest. The margins are structurally under pressure throughout the value chain: agriculture, transformation, production, logistics, transport, large-scale distribution and catering need to return to investing in their business, to generate wealth for the country. 

Alfredo Pratolongo, president of AssoBirra, said: "2023 has been a particularly difficult year for the brewing industry. After a decade of growth, the crisis triggered by the pandemic contingency and the recovery in 2022, consumption has fallen this year by almost six percentage points. For the future I remain positive because beer in Italy has now become a meal drink, identified with informal conviviality, appreciated for its characteristics of lightness, versatility, naturalness and low alcohol content, or non-alcoholic. The latter, is not a factor to be underestimated, because upstream of the free choices of consumption -at the table and not, beer is a choice of pleasure that allows you to consume certain quantities and moderate or zero and, at the same time, to enjoy a refreshing and defined taste, sparkling and pleasantly bitter, which enhances by contrast or assonance the most diverse dishes and ingredients and the heterogeneous richness of flavors of the Italian culinary heritage". 

"Being part of the menu of Italians is a structural factor and therefore allows for a cautious optimism for the future, but it is also essential not to lose focus on the commitments that await us in the coming months, the need for simpler and simpler procedures for access to national and Community funds, the updating of certain articles of the beer law and, we hope, a reduction in the specific tax burden", increases Pratolongo.

He continues: "Excise duties in particular -anachronistic for a meal drink and incongruous, because beer is the only one on which they weigh- are all the more distressing because they penalize Italian companies compared to those working in countries, so to speak, more beer friendly in terms of taxation, against which there is in fact a kind of spread that penalizes Italian companies that export beer there. And, specularly, they favor the business of their national companies, stimulating their competitiveness and therefore also the export of beers to Italy because, paying much less excise duties at home, they have higher margins and can therefore be more competitive with the beer they export from us".

A complex context, therefore, in which the brewing segment does not stop innovating and diversifying its offer, showing itself to be proactive and confirming not only its economic value, but also its positive cultural impact on Italian society. The brewing culture in Italy continues to adapt and improve, increasingly marrying a tendency to moderate and responsible consumption, and continuing to respond to the continuous changes and new trends in the market.

"Despite the unfavourable circumstances and the current braking factors, which risk slowing down or limiting the further development of the brewing sector, we are convinced that beer has the characteristics to grow again in the future" concludes the president of AssoBirra. "The ability of entrepreneurs to innovate, both at the product level and in sustainability strategies, allows us to respond to current and prospective consumer needs, and to leverage some macro-trends of the Italian market: localism, health and lightness, that allow consumers to appreciate the great variety and quality of the offer brassicola in Italy. The companies have invested in advanced technologies and sustainable practices, enhancing the territories and cultural heritage of our country, bringing beer to be today an integrated meal drink in the habits of Italians and an icon of conviviality, and a democratic and accessible product, both for the taste and for the low alcohol content, with a really excellent quality".

Sustainability, ecological transition and innovation

Sustainability and ecological transition remain a priority for AssoBirra, which encourages sustainable production practices and the use of advanced technologies, promoting water management and reducing environmental impact as key objectives for the sector. 

Federico Sannella, vice president of AssoBirra with responsibility for Ecological Transition and Sustainability, comments: "The process of ecological transition also concerns the primary, the agricultural sector that has long been engaged in research in the field of raw materials and a more sustainable use of the territory. Technological innovation and development, however, feed mainly on economic investments, and it is here that the role of the transformation sector is strategic, central, essential. In times when energy costs have such an impact, the path towards carbon neutrality requires a change of strategy, an action no longer only individual, but systemic, of the industrial sector in its entirety. Let us not lose sight of how reuse, and in general every transformation, requires strong investments. It is a very fluid subject at the moment, and it is crucial to remain alert and ready to seize any opportunity. Ad hoc solutions could be at a junction point between the two systems. And this is where the technical work that we carry out in AssoBirra, aimed at identifying on the one hand the most performant and sustainable strategy, both macro and associative, on the other, as a guide of the segment, to identify models compatible with the needs of individual companies".

For AssoBirra, sustainability is not only economic and environmental, but also social. The category is committed to promoting behaviours in line with a style of responsible consumption of alcoholic beverages, for example with investments in products with zero or low alcohol content, or even in terms of diversity, equity and inclusion. In line with moderate Italian consumption, low and no alcohol consumption in 2023 accounted for 1.86% of the total.

"If we want the segment to become strategic for Italian food, if we aim for real and measurable growth, we must invest in a series of elements: brands, plant sustainability, efficiency, productivity, research and the use of highly qualified skills and, finally, high value-added talents to be retained and valued. The environmental transformation cannot be separated from the digital one and for some time now AssoBirra has been committed to the issues of DEI (Diversity, Equity and Inclusion), but it is not only a problem of the sector. Women’s access to the world of production at all levels, to the digital sectors, to advanced technologies, to artificial intelligence, is still too limited and it must be reversed, now without further delay. Of all possible investments, the one on human capital is the most urgent and promising", concludes Sannella.