Beer market Global beer production falls - China remains in the lead

Less beer was produced worldwide last year - but hops thrived. This exacerbates the overproduction of the flavoring agent.

Global beer production has fallen. A total of 188 billion liters of beer were produced last year, according to the annual report from the world's largest hop trader Barth Haas in Nuremberg. This was 0.9 percent - or 1.7 billion barrels of beer less than a year ago.

The decline came as a surprise: "After recording slight growth in 2022 despite adverse conditions, we were also expecting a small increase for 2023," says Barth Haas Managing Director Peter Hintermeier.

Germany defended its fifth place as a beer producer, although beer output fell by 3.3% to just under 8.5 billion liters. According to the report, China is the world's number one beer producer with 35.9 billion liters, ahead of the USA with 19.3 billion, Brazil with 14.9 billion and Mexico with 14.2 billion liters. While emissions fell slightly in China and significantly in the USA, Brazil and Mexico both recorded slight increases.

"Consumers are groaning

According to Barth Haas, it is difficult to predict how beer production will continue. "The brewing industry is still feeling the effects of the war in Ukraine," says Thomas Raiser, who is also Managing Director of the hop trader. "Consumers in many countries are groaning under the weight of high inflation. We therefore only expect beer output to remain stable in the current year, but there is no clear trend for the future."

At least there will be no shortage of hops in the foreseeable future. The cone harvest was significantly more plentiful than in the previous year. 118,415 tons represented an increase of 11.5 percent. However, this is also due to the weak comparative year, which was characterized by drought, heat and heavy thunderstorms, among other things.

Market is oversupplied with hops

Overall, however, Barth Haas continues to see an oversupply of alpha acid, the hop ingredient that gives beer its bitter taste, on the market. As a result, the cultivation area must be reduced in order to adapt it to the reduced demand. This already happened last year and the trend is continuing this year, as figures from the German Hop Growers' Association suggested a few weeks ago.

However, the majority of the decline is in the USA, as Barth Haas also reports. As a result, Germany has regained the title of the world's largest hop producer by acreage this year. In the 2023 harvest, however, the USA was still clearly ahead with 47,601 to 41,234 tons. The 2024 harvest is still pending - the Barth-Haas report in 2025 will show who produces the most hops this year.

However, the developments on the hop market are unlikely to have a major impact on the price of beer: The cost of the ingredient is hardly significant given its comparatively small share.