Beer Production: National Economic DriverBy Alessa Flores | Thu, 05/21/2020 - 13:07
Beer production will resume on June 1 in Mexico City, after Claudia Sheinbaum, Governor of Mexico City, in a virtual press conference, considered this an essential activity alongside mining, construction and manufacture of transport equipment. It should be noted that on April 6, the beer industry stopped operations as it was not considered an essential activity according to the provisions of the General Health Council. However, the city’s reopening will allow beer production to restart on June, even though the city will still be in red alert according to the government’s traffic-light risk assessment system.
Despite the fact that the beer industry was not considered an essential activity from the beginning, it contributes significantly to the country's economy, manufacturing sector and other areas of public life. In Mexico the brewing industry represents 29.3 percent of the total gross production in the beverage sector, being the second-most important economic activity in the sector, according to INEGI. Also, according to gross production data, the brewing industry ranks among the 14 most important activities in manufacturing production, out of a total of 291 activity classes, after oil refining and automotive manufacturing.
Every year, the beer industry in Mexico contributes more than US$20 billion derived from its sales and from the income of business activities that are directly linked to it, according to a report by the Federal Consumer Prosecutor's Office (PROFECO) and the National Chamber of the Beer and Malt Industry (CANICERM). Only in 2019, according to Karl Siqueiros, General Director of Cerveceros de México, beer production was 124.5 million hL and exports reached 40.1 million hL. With a value of US$4.9billion, this represent 25 percent of Mexico's agro-industrial exports. The beer trade balance reached a surplus of US$4.7 billon.
Today, Mexico is the largest beer exporter in the world, with two out of every five beers exported made in the country, and the fourth-largest beer producing country in the world, according to Cerveceros de México. Since 2018, Mexico has diversified its exports. Of the total of 40 million hL exported in 2018, the US continues to be the most important destination for Mexican beer with 74 percent of all Mexican exports. China follows the US with 4 percent, along with the UK with 3 percent, Australia with 2 percent and Colombia with 2 percent, according to data from the same organization.
Mexicans love beer and the numbers do not lie. Globally, Mexico occupies the sixth place in beer consumption and second in Latin America. On average, it is estimated that Mexicans consume 6.1L of beer per month, not counting December, month in which they consume about 7.9L, according to Cerveceros de Mexico. In addition, according to Kantar Worldpanel México, an international market research agency, more than 69 percent of households in Mexico buy beer, of which 91 percent prefer a light beer and the other 9 percent a dark beer.
Despite the fact that beer is widely consumed throughout the country, there are states that stand out for their consumption. Monterrey is the city that consumes far more beer in Mexico, accounting for 16 percent of all national consumption. On average, Monterrey residents consume around 72L per person, which is equivalent to 203 bottles of 355mL. In addition, the vast majority of customers purchase beer from their local supermarket, where they purchase 4 out of every 10L. In comparison, 30 percent is purchased at warehouses and 11 percent is purchased at grocery stores, according to Cerveceros de México.
The decision to add the beer industry as an essential activity has been applauded. Cuauhtémoc Rivera, President of the National Alliance of Small Merchants (ANPEC) stressed in an interview with Milenio that "it is a very good sign that we hope will mark a trend toward the reactivation of beer production to supply the domestic market."