Booming NZ brewing sector worth $2.7bn despite Covid woes

2nd December 2020 By Samantha Worthington | samantha@foodticker.co.nz | @foodtickernz

New Zealand’s brewing industry is now worth $2.7bn, up from $2.3bn recorded in the year prior, despite Covid-19 costing the sector millions. 

The Brewers Association of New Zealand-commissioned research, produced by The New Zealand Institute of Economic Research (NZIER), found that on top of the growth for the year to March 2020, the sector had contributed $634m in value-added GDP.

It was also found to support more than 7000 jobs through brewing and the purchase of intermediate inputs to the brewing process, and paid over $470m in wages.

Despite the sector’s growth, Dylan Firth, executive director the Brewers Association of NZ said “there was no doubt” Covid-19 had impacted results.

“The closure of licenced establishments due to the initial lockdown cost the industry an estimated $300m in sales. Even when taking into account a slight increase in off-premise sales in the June quarter,” said Firth. 

“The value of the sector and GDP data in this report are for the year-end March 2020 and hence the full impact of Covid-19 is not yet captured in the data.”

The effects of Covid-19 were seen to be trickling through sectors, with a lack of tourism one of the biggest hits for brewing in New Zealand. 

On-licence sales were likely to be the most impacted, with forced closures, social distancing requirements and next to no tourists. 

“Over the coming year the industry faces challenges with reduced demand from international visitors, as Covid-19 related border closures have reduced tourist numbers to a trickle. Prior to Covid-19, tourists spent $400m on beer each year,” said Firth. 

Findings also showed New Zealand had 257 breweries, which was more breweries per capita (0.51) than the UK (0.42), Australia (0.29) and the US (0.23).