While the pandemic exacerbated ongoing trends in Ireland's beer industry, the current climate of inflation has made a comeback more difficult. Ireland, like many countries, has seen a continuous decline of beer consumption for years. Consumers are not only turning to other beverages but increasingly drinking less alcohol altogether. It is not all doom and gloom though as beer segments that cater to the sober-curious and those consumers looking for something special when they do have beer are on the rise.
On-trade woes
The
Irish beer market was valued at 2.4 billion U.S. dollars in 2023, with more than half of revenue stemming from on-trade sales. Revenue has not yet rebounded to pre-pandemic levels.
Beer production in Ireland had remained relatively stable up until the pandemic and its associated closings of on-trade establishments. The
closing of pubs is not a new phenomenon though. While closings due to the pandemic were meant to be short-lived, the amount of pubs across Ireland has been on the decline for years. On average, across the country there are 23.4 percent less pubs today then there were in 2005. Limerick has been particularly hard hit with a decline of 35.6 percent.
Decreasing consumption
The decline in pubs can at least partially be blamed on a decline in beer consumption, another trend that the pandemic accelerated but did not cause. Between 2008 and 2019
per capita consumption of beer declined in Ireland by 22 percent. During the pandemic years, consumption declined by an additional 21 percent. It has since rebounded but nevertheless reflects the downward trend. When the pubs reopened, consumers now had another reason to cut back on their alcohol consumption, inflation. In particular, the rising energy prices during the autumn and winter of 2022 saw staggering increases in beer prices compared to the year prior. In December of 2022, the
consumer price index for beer in Ireland grew by nearly 17 percent compared to the same period in 2021. Inflation has since declined but still remains elevated.
Where growth can be found
Despite the particularly rough few years, beer is still the favorite alcohol beverage in Ireland, accounting for 42.9 percent of
all alcohol consumption in 2023. Some segments offer growth opportunities as well. Craft beer, which commands a higher price than other segment is on the rise.
Its share of overall beer consumption is still relatively small at 3.4 percent but has grown by 467 percent since 2012. Likewise,
non-alcoholic beer accounts for just two percent of all beer sales but has grown by 400 percent since 2017. The future of Ireland's beer industry will depend on giving consumers good reasons to stick with beer, whether that be affordability or a focus on segments that appeal to changing tastes.
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