The Per capita consumption of Beer segment in Latvia reached 86.36 Litres in 2022
The indicator recorded a historical growth (CAGR) of 2.51% between 2019 to 2022, and is expected to grow by...
GlobalData projects the indicator to grow at a CAGR of...
Per capita consumption of Beer segment in Latvia recorded a single-digit YoY decline in 2020
After recording a significant growth between 2017-2019, the per capita consumption of beer in Latvia recorded a single-digit YoY decline in 2020.
Stringent legislation to hinder growth
With the Latvian Government reducing the excise tax rate on strong alcohol for a period between August 1, 2019, until February 29, 2020, the beer and cider market saw significant growth. However, in a bid to reduce alcohol consumption, the government again increased excise duty on beer, effective March 2020. Meanwhile, the ban on large PET bottles, which had been planned to come into effect in 2018, was postponed to September 2020, as manufacturers asked the government for more time for the transition. However, a handful of manufacturers have already changed their packaging, making products smaller but more expensive. This ban will push less affluent consumers to either upgrade their product or migrate to the illegal market.
Rising consumer spending fuels growth
Despite an apparent slowdown in the country’s economy in the financial year 2018–19, increasing incomes, rising consumer spending and growth in related industries such as retail, drove consumer spending, and in turn increased demand for beer and cider in Latvia. As a result, individuals moved towards premium variants in some categories in the search for heightened consumption experiences. Premium packaging formats that target high-end product-focused consumers are on the rise in the Latvian beer and cider market. However, with the economy set to enter a recession in 2020 due to the impact of COVID-19, the demand for beer and cider is predicted to take a hit, as consumers cut down on discretionary expenditure.
Shift towards healthier drinks
Rising health awareness among consumers is prompting a sizable number of consumers to seek products that are positioned as healthy. As a result, the health and wellness trend continues to dictate shifts in the Latvian beer and cider sector with consumers opting for beer with no/low alcohol in an attempt to lead a healthier life. Furthermore, Latvians are opting for products that include claims such as low in sugar and low calorie. However, this has improved the prospects for low- and no-alcohol beers, particularly among young adults, who are cutting back on alcohol consumption for health reasons, as well for social reasons, with many wanting to be able to socialize without getting intoxicated.
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