Wednesday, August 26, 2009

Beer prices rise for the Consumer as Costs of Production Fall and Profits Rise

A number of brewers announced recently that the price of beer that the consumer pays will be going up citing rising costs. In the CNN story above the reasons given are less vague. The brewers claim to be raising prices to offset rising commodity prices and fall in volumes. Though, commodity prices have fallen recently and have caused farmers and dairies to worry about staying profitable this year. Also, ten days ago Anheuser-Busch InBev announced that their second quarter profits had grown despite the drop in volume because of cost cutting measures. One has to work through the maze of business doublespeak in these non judgmental articles regarding price increase and increased profitability to understand that cost cutting and "synergies" in these cases refers to job cuts as a result of the InBev takeover of Anheuser-Busch.

If you are the kind of person who likes to buy American and support American jobs, it is getting harder and harder to find an economical beer. Though some of the big brewers still employ Americans.

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