Kenya’s leading alcohol producer EABL hikes prices on back of tough operating environment

KENYA – Kenyan alcohol lovers will be forced to dig deeper into their pockets to purchase some of their favourite brands from the East African Breweries Limited’s (EABL), after the alcohol producer revised some of its prices upwards.

According to report by The Nation, EABL has made a price increase of between Ksh. 10 (US$0.093) and Ksh. 500 (US$4.64) depending on the type of drink and quantities.

The price revision affects beers brands such as Whitecap Light, Tusker Lite, Cider and Malt, Guinness (regular), Whitecap Lager, Balozi and Hop House 13, whose prices have increased by between Ksh.10 and KSh20 (US$0.19).

Meanwhile, whisky, brandy, vodka, gin, liqueur and ready-to-drink consumers will also find the going a little tougher after EABL increased the prices up to Ksh500 (US$4.64). Some of the affected drinks are Gilbey’s, Triple Ace, Smirnoff Red, V&A cream liqueur, Black and White, Johnie Walker and Singleton.

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“We haven’t increased prices since 2019, despite the excise inflationary adjustment in 2020. We have absorbed costs over this period.”

Eric Kiniti – Corporate Relations Director

But even amid the new price shakeups, drinkers of some brands have been left unaffected after their prices were retained. These include the company’s flagship beer brand Tusker, Chrome gin and vodka and, Senator Keg, among others.

This is in a bid to prevent a flight back to the infamous second-generation drinks. Low-income consumers tend to be price-sensitive and an increase would likely trigger a reduction of the quantity of alcohol they drink, or they seek alternatives that might even include illicit alcohol.

The brewer said the adjustment was prompted by an increase in the cost of doing business, including an increase in excise duty that they did not pass to the consumer. 

“We haven’t increased prices since 2019, despite the excise inflationary adjustment in 2020. We have absorbed costs over this period,” said Eric Kiniti, the corporate relations director.

Other than increased excise duty, Kiniti said higher fuel costs over the last two years had also driven up EABL’s operational costs.

“During the Covid-19 period, we have also seen rising costs in our raw materials, resulting from logistical challenges and inflation in the last year,” he said.

The removal of a tax incentive that the government had put in place to cushion businesses during the pandemic, despite some restrictions still being in place, also contributed to the EABL price hike.

Consumption of alcohol in the last few months has been negatively affected by Covid-19 protocols that saw restaurants and pubs closed to curb the spread of the disease.

Currently, pubs and other entertainment joints are expected to close at 7pm.

The regional alcohol producer has undertaken the price review at a time it is set to inject Ksh1 billion (US$9.2m) in the establishment of a new spirit processing line, in a bid to meet the high demand witnessed in the segment.

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