Price of beer set to soar as plunging pound sees the cost of imported hops skyrocket
26 September 2022, 12:45
A leading brewery boss has warned the price of beer could be set to soar, as the pound plummeting against the dollar leads to the increased cost of hop imports.
Paul Davies, CEO at Carlsberg Marston's Brewing Company, today linked the falling value of the pound to the increased price of hops – a vital ingredient in the beer brewing process which are primarily sourced from the United States.
Commenting on the “volatile” price of the pound, Mr Davies says that “at some point that is going to have to be passed through to both the customer and the consumer”.
Following a wave of tax cuts announced on Friday by Chancellor Kwarsi Kwarteg, the pound plummeted to its lowest level against the dollar since decimalisation began in 1971.
Falling by more than 4% to just 1.0327 dollars in early Asia trade on Monday morning, it later regained some ground, reaching a high of 1.05 dollars.
Speaking on BBC Radio 4's Today programme, the beer boss said the prospect was a 'worrying' one for the British beer industry. which imports its beer and hops from overseas.
Mr Davies said: “Many of the hops used in this country are actually imported and a lot of them, particularly for craft brewers, are imported from the States, so changes in currency is actually worrying for industry, for sure.
“And then of course people drink a lot of imported beers from Europe, and the euro vs the pound is also something we're watching very closely at the moment.”
The Chancellor says he plans to use the increase in borrowing to fund public services at the same time as he cuts taxes.
“I would say as an industry we're generally using British barley and we're using a lot of British hops,” adds Mr Davies optimistically.
Noting the nation’s love of double IPA’s “requires a lot of Citra hop” and “other hops from the States”, the beer boss reflects that price increases are nigh-on inevitable.
Meanwhile, the Chancellor is not expected to comment on the plummeting pound, Downing Street said.
The Prime Minister's official spokesman said on Monday: "I think that the Chancellor has made clear that he doesn't comment on the movements around the market and that goes the same for the prime minister."
