Germany's most famous export is only going to get more expensive
Verena Brüning for Insider
- Economic conditions are making Germans' favorite drink less affordable.
- One brewer in Berlin said delivery, personnel, and malt costs have risen.
- Beer is also more expensive in supermarkets, with a liter 26% more expensive than in 2011.
BERLIN, Germany — Helmut Kurschat runs the Brauhaus Südstern restaurant in Berlin. Unlike many pubs and bars, Kurschat doesn't have his beer delivered — he brews it himself.
Despite this, he can't avoid raising his prices.
Last year, a 400-milliliter, or 14 ounce, beer at Brauhaus Südstern cost 3.60 euros, or around $3.68. Today it's 3.90 euros, an increase of just over 8%.
"The cost of everything has gone up," Kurschat told Insider in Brauhaus Südstern's beer garden.
Because he brews beer in boilers heated with electricity, production is energy-intensive.
The German-language newspaper NZZ reported that customers in Germany who sign an electricity contract today are paying hundreds or even thousands of euros more than they did last September.
"Fortunately, I still have an old contract, which so far hasn't gone up," Kurschat said.
Verena Brüning for Insider
Kurschat's profits have been hit by a number of other factors, though.
His suppliers are charging more to deliver his beer ingredients from Bamberg to Berlin, a 250-mile journey, due to increased fuel costs.
As a result of Russia's invasion of Ukraine, prices for diesel and gasoline have risen sharply, with both at times exceeding two euros per liter, despite Germany introducing a fuel-tax cut on June 1.
The malt needed to make beer has also become more expensive.
"It's eating away at profits from all sides," Kurschat said.
Holger Eichele, the chief executive of the German Brewers Association, told Insider that the price of malt had already been on the rise during the COVID-19 pandemic, and it's now 70% higher than in April last year.
"It's becoming increasingly difficult for breweries to obtain brewing malt at affordable prices," Eichele said.
The constant supply bottlenecks don't end there.
According to the Deutscher Mälzerbund (the Maltsters' Association), the price for brewing grain has doubled from 200 euros per ton to 400 euros in around a year.
"On top of that, labor costs are also rising in our company, but I can't criticize that. Twelve euros, which is now supposed to be the minimum wage, is still not excessive," Kurschat said.
In the summer, he said he employed up to 15 people in his business, all of whom he wanted to pay fairly. And those extra costs have to be covered somehow, Kurschat said.
"For us, it goes through the consumers, to whom we pass on the increased costs," he said.
Consumers have already been absorbing the effects of this price spiral — even when they buy a beer in the supermarket.
An evaluation by the market-research company Nielsen IQ found that beer has become consistently more expensive in Germany over the past 11 years, rising 26%. In 2011, a liter cost 1.13 euros; today, it costs 1.43 euros.
The sharpest increase occurred from 2021 to 2022 amid the war in Ukraine, while 2019 to 2020 was the only period when the price of a liter didn't change.
Verena Brüning for Insider
Kurschat doesn't think that the price increases have reached their peak. "I think that the price will rise another 10 to 20 cents this year alone," he said.
Kurschat said he's been in the restaurant business for more than 40 years now.
"My lease here runs for another five years, and then I'll be 70. At that age, it's OK to call it a day," he said.
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