As the New Year Day and Tet holiday is drawing near, many general agents have started to hoard beer to take advantage of expected rising demand for the holiday.

Though it’s still not peak time to shop for food and drink for the weeklong holiday, wholesale beer prices have risen by VND10,000-20,000 per 24-can carton, driving retail prices much higher than they were a month ago.

Many dealers told Tuoi Tre that the retail prices will likely increase each day.

Race (to hike prices) against time

Quang Hung, a large beer dealer on Nguyen Van Nghi Street in Go Vap District, said at present the wholesale price of popular beer brands such as Heineken, Tiger, and Saigon Special are much higher than just a month ago.

“Previously, a Heineken carton was sold at about VND370,000, but recently increased to VND385,000.”

 Meanwhile, data compiled from many retail outlets shows that the average price of beer has increased by some VND13,000 compared with the price a month ago.

Mai Van Thuan, a beer dealer on Le Van Khuong Street in District 12, said the reason for the price difference between dealers is due to their reserves, which are often stocked in advance.

"Normally, only big dealers with huge capital can store large quantities of beer to moderate their sale depending on market supply and demand. If they hoard beer, dealers can change the prices depending on the market value, taking advantage of the rise in demand.”

According to a beer hoarder who does not want to be named, the recent price hike took root from the fact that the price of all major products from Vietnam Brewery Co Ltd (VBL), the owner of many beer brands such as Heineken and Tiger, has increased by approximately 7%. This mainly applies to Heineken, which is the preferred beer to give for Tet.

With factory prices of VND352,000 per carton of Heineken, the price sold to the first-tier dealer is at VND370,000 per carton, and the price offered to consumers should be around VND390,00-395,000 per carton.

“This situation occurred due to the newly adjusted sales policy of VBL, which shifted from offering on demand for general dealers to specific quotas for specific dealers.”

“As supply shrinks right at the gate of the supplier, it’s obvious why beer supply cannot keep pace with demand.”

Also according to the hoarder, the biggest beneficiaries of the new policy are some specific general dealers. This is also the reason why many general agents try to hoard Heineken as much as possible so they can proactively offer it to smaller dealers in small quantities, causing the supply to lag behind demand so they can earn more from increased prices.

Standing aside

However, this situation won’t occur to all beer products on the local market.

Phan Dang Tuat , Chairman of Saigon Beer-Alcohol-Beverage Joint Stock Corp (Sabeco), said presently, no price adjustment has been applied to two flagship products of Sabeco, "333" and "Saigon Red."

“The two aforementioned beers currently account for 80% of the manufacturing output of Sabeco and there will definitely be no price increases for them this Tet,” Tuat insisted.

Sabeco’s total monthly output was at 140 million liters since November 2013, up 40 percent month on month, due to rising demand.

The company will consider raising the output by 20-30 million per month if the demand rises too fast, he added.

According to data from the Vietnam Beer Alcohol Beverage Association (VBA), SABECO grossed nearly $926 million in the first 9 months of this year, up 14 percent year on year.

Still thirsty

New statistics released late last week by the Ministry of Industry and Trade showed that beer production in November was estimated at 273.9 million liters, an increase of 15% compared to the same period last year.

The newly released data brought the accumulative beer output in the first 11 months of this year to over 2.67 billion liters, an increase of 7.8% over the same period last year.

Meanwhile, the Vietnam Beer Alcohol Beverage Association (VBA) asserted that maintaining beer production output in December to about 270-280 thousand liters is feasible and the total output will probably reach 2.94-2.95 billion liters of beer by year-end.

In May, market research organization Eurowatch also published figures showing that 3 billion liters of beer were sold in Vietnam in 2012.

On average, each Vietnamese person consumes 32 liters of beer per year. Vietnam is the "beer drinking champion" of the ASEAN region, the third in Asia after China and Japan, and in the top 25 beer drinking countries globally with an annual growth rate of 15 percent.

Meanwhile, per capita income in 2012 was not at a high level, at only $1,540 per year in 2012 and $1,960 per year in 2013, among the lowest in the region, just ahead of Laos, Cambodia, and Myanmar.