Photo: Magda Ehlers
It is expected that it will take years for South Africa’s craft distillers and brewers to recover from the nationwide lockdown to contain the coronavirus disease (COVID-19) pandemic and resultant prohibition on the sale of alcohol.
This emerged in a panel discussion recently hosted by Messe Muenchen South Africa. The discussion was moderated by Clive Belcher, chairperson of the Institute of Brewing and Distilling (IBD) Africa and managing director of Global Beverage Solutions.
The national lockdown was announced by President Cyril Ramaphosa at the end of March, and was aimed at slowing the spread of COVID-19.
The sale and transportation of alcohol was prohibited during the lockdown.
The panellists’ discussion highlighted the challenges that resulted from the sudden implementation of the lockdown, including brewers being left with beer still in tanks, key contracts and cash flow drying up, and the negative impact on supply chains.
This meant that most brewers would be unable to resume production immediately after the ban was lifted.
Apiwe Nxusani-Mawela, brew master and founder of Brewsters Craft, said that brewing was a three-week long process, and that as such, brewing would not resume immediately after the ban was lifted.
He added that cash flow was a problem for brewers, and that buying raw materials and packaging would thus be a challenge.
Wendy Pienaar, chairperson of the Craft Beer Association South Africa, said that operational issues also had to be considered.
“[These include] getting staff safely to work, and making the brewery safe for customers and staff. Even if the ban is lifted, it won’t be the end of the challenges we will face.”
She added that brewers and distillers would also face challenges to obtain yeast, hops, botanicals and bottles.
Hendré Barnard, acting secretary of the Southern African Craft Distilling Institute (SACDI), said that innovation would be a key to survival. He added that online sales would likely take off first, before in-store sales, after the ban had been lifted.
“Craft brewers and distillers who haven’t done so yet need to get an online sales portal live in the next week, or they could miss that opportunity.”
He added that the market could become more price-sensitive and that brewers and distillers needed to prepare for this. “We need to face the very real possibility that the market is going to change; we are in a recession, and the first thing that suffers will be luxury goods.”
