The COVID-19 pandemic had a positive impact on retail beer in 2020. Due to lockdown, increased stress levels and financial uncertainty, people started consuming more alcohol in Lithuania.
The horeca channel closed from 16 March as the country went into lockdown, not being allowed to reopen again until 27 April, thus losing a considerable portion of annual income from beer. It is expected that around two million litres of beer that was not sold through on-trade establishments was destroyed.
As the largest category, standard lager took the biggest hit in absolute terms owing to mass on-trade closures in 2020. Understandably given the strong fall in purchasing power arising from pandemic-related unemployment and reductions in working hours, premium lager, which relies on the on-trade the most, registered the worst performance in total volume terms.
Retail beer is poised for a moderate decline in 2021 as custom gradually returns to the reopened on-trade. Over the remainder of the forecast period, it is likely that beer in the off-trade will record small annual gains again.
The search for new flavours and novelties, with quality rather than quantity being sought after, is giving rise to premiumisation in the local market. This has already boosted the growth of some rather small beer categories, for instance stout beer.
Recovery in the on-trade over the forecast period will be aided by the requirement for shorter sales hours in the off-trade, introduced in 2018. The reduction in the window of opportunity to buy a beer from retail will push busy city dwellers to resort to having one at a bar rather than staying in.
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This report originates from Passport, our Beer research and analysis database.
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