Alcohol drinkers in South Africa are in a sombre mood after the South African Breweries (SAB) revealed they might be forced to discard of 132 million litres of brewed alcohol which it is stuck with since lockdown resumed.
The brewery company, which brews Castle Lager, Hansa and Carling Black Label made an urgent appeal to the government to allow them to bottle the 132 million litres of unbottled alcohol and transport to their depots for storage. Under the current lockdown rules, the transport of alcohol – apart from alcohol for export – is currently illegal. All sale of alcohol is also prohibited.
South African Breweries has not been brewing since March 23rd, nor has it or transported beer since the start of the hard Covid-19 lockdown on March 27th.
Currently, SAB has around 132 million litres of beer – roughly the equivalent of 400 million bottles of beer – sitting in its tanks, which it can’t bottle due to the restrictions on alcohol capacity at its breweries.
In a presentation to the government, SAB said that if it is not allowed to transport beer within the next day or so, it will be forced to discard this inventory, at a loss of an estimated R150 million.
“As the movement of alcohol is not permissible – the beer would in this unique instance need to be destroyed,” the company said. Netwerk24 reports that SA Breweries sent a proposal to the department of trade and industry on Tuesday, asking that it be allowed to transport packaged beer from its breweries to its storage depots.
“Urgent action is needed to avoid material financial losses to both the government and SAB, as well as significant job losses,” the company said in the document.
If SAB has to destroy the 132 million litres of beer, the company would be forced to operate at about 50% capacity for four months. No bottling or distribution could take place, given that the beer is discarded. “This would mean the loss of about 2,000 jobs – half of SAB’s frontline workforce.”
It would also mean an immediate loss to the government in excise tax of around R500 million.
Disposing of the beer would also be a massive challenge, SAB says, which could take at least 20 weeks. It warned that it could cause serious environmental risk.
If granted permission to move the beer, SAB said that it will work with the police to secure the alcohol.
