South African brewer may be forced to dispose 400M bottles of beer after alcohol ban


South African brewer may be forced to dispose 400M bottles of beer after alcohol ban
Bottles of beer move along a production line at the South African Brewery in Alrode April 2, 2009. REUTERS/Siphiwe Sibeko

In Summary

  • The brewer told eNCA that it has not sold or transported any beer from its depot to warehouses in the country since March 26, 2020.
  • This, it said, may occasion unwarranted losses since brewery facilities have a limit to which they can store alcohol.

South African Breweries (SAB) may be forced to dispose at least 400 million bottles of beer after the country banned the sale of alcohol during the lockdown occasioned by the spread of the coronavirus.

The brewer told South African broadcaster eNCA that it has not sold or transported any beer from its depot to warehouses in the country since March 26, 2020.

This, it said, may occasion unwarranted losses since brewery facilities have a limit to which they can store alcohol hence if the alcohol continues to ferment then the company will be unable to operate “at full capacity for at least four months.”

SAB is now seeking special permission from the government to transport the 130 million liters (approximately 400 million bottles) of beer to its warehouses saying if this is not done “in the next 48 hours” then it “will be forced to discard this inventory at a loss of an estimated R150 million.”

“For SAB to be able to continue packing the current brew, they have to be able to transport the alcohol to SAB owned warehouses for safekeeping. SAB are not legally allowed to store brewed beer once it reaches a certain capacity,” the company told the news outlet.

“Once breweries reach permissible limits, the alcohol needs to be stored on offsite SAB owned facilities. As the movement of alcohol is not permissible – the beer would in this unique instance need to be destroyed.”

If not allowed to transport the alcohol, SAB added, then at least 2,000 jobs will be affected and the South African government also stands to lose excise tax to the tune of R2 billion.

“SAB is respectfully requesting that it be allowed to transport packaged beer from its breweries to its storage depots for the sole purpose of protecting its inventory,” it added.

“Urgent action is needed to avoid material financial losses to both the government and SAB, as well significant job losses.”

The company further made a case that disposal of the beers could pose an environmental risk.

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Story By Ian Omondi
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