The restrictions implemented in Chile as part of the strategy to curb COVID-19 infections, strongly impacted beer sales in the country, resulting in a strong on-trade decline, and falling sales overall. Despite the increasing consumption registered in the off-trade channel, the closure of non-essential businesses and operating restrictions during much of 2020 hit bars and restaurants, which had to either close their operations altogether or adapt to takeaway/delivery solutions, both negative scenarios for beer sales, which these outlets accounting for a fair proportion of local consumption.
Registering strong growth in 2020, the e-commerce channel was one of the “winners” in the beer category during the pandemic, with companies rushing to adapt to the new trend, as consumers sought ways to avoid the long lines and fear of infection that surrounded shopping in supermarkets. Major companies such as CCU, which launched its labarra.
Initially related to mass consumption brands, the can format has started to spread to smaller breweries. The pandemic and the subsequent restrictions implemented heavily impacted craft beer.
As the pandemic moves to a later stage, with mass vaccination campaigns in progress in the first half of 2021, beer in Chile is set to start its recovery process. The on-trade channel, which started to reopen for local consumption in September 2020 after a long lockdown, will register marginally positive growth in 2021, while the off-trade channel, which continued to see positive growth during the pandemic in 2020, will register a slight decline in 2021.
With the expected recovery in the forecast period, major players CCU and AB InBev are investing in increasing their production capacity. Having already started, due to the import costs, to locally produce brands, such as Becker, which were previously fully or partially imported, AB InBev started to expand its manufacturing site in 2019, with the objective of tripling its capacity.
Beer bars, a movement that has been spreading not only in the major city in the country, Santiago, but also in other regions, is set to continue developing with the reopening of the on-trade channel and the resumption of consumption of draught beer. Usually having several smaller beer brands on their taps, these bars, which can also take the name of local breweries such as Kuntsmann, Kross or Guayacan, present themselves as an opportunity to put consumers in contact with emerging brands.
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This report originates from Passport, our Beer research and analysis database.
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