Given the pressures affecting spirits suppliers at the moment, it's hardly a shock to see prices moving up almost across the board - with only liqueurs and specialities showing a 1% drop in average per
Indeed, the biggest surprise is that these figures haven't increased further and faster. Only single malt Scotch, blended Scotch and imported whiskey show increases of 3% or more
at a time when UK inflation has hit 4.4% - more than double the target of the Monetary Policy Committee. What's more, the overall rise for spirits stands at just 1.7%.
But inflation is currently the least of the spirits industry's worries. Just about every
input cost involved in the production of gin, vodka, rum, whisky and brandy has gone up in the past couple of years. And, despite a slight calming in petrol pricing, there's little sign
these pressures will ease in the near future.
The key industry players are unanimous on the subject. "We're not surprised by the figures," says Gavin Partington, head of communications at the Wine
& Spirit Trade Association. "It's what you'd expect to see, given the big rise in excise duty earlier in the year and the increasing costs of raw materials, energy and transportation."
Nor is there much disagreement about what is going to happen next: further price increases are viewed as inevitable, whatever the buying power of the multiple retailers and the desire to minimise the price rises being passed on to consumers.
Indeed, Gin & Vodka Association director general Edwin Atkinson warns
these Nielsen figures may be painting a deceptively rosy picture of what's really happening in the market.
Atkinson's wariness is based on reports of record stock clearances in March, prior to the Budget - then far lower sales in the April-June period. "People were expecting a Budget rise, so they cleared as much stuff as they could with promotions," he says.
These volatile trading levels have had an artificially deflationary effect on average prices, the argument runs - and this is likely to be exacerbated by the very high volume of pre-Christmas trading, when duty rates were lower. In other words, we'll only get a true picture from the MAT figures in the
"The impression I got after the Budget was that there was a 100% pass-on of the Budget increases in the off-trade," adds Atkinson. "But I'm waiting until January until I'm making any broad comment."
By then, price rises are very likely to have accelerated further, but predicting the effect of these increases during an economic downturn is tricky. "Given the scale of these cost increases, we'd certainly expect to see further price rises," says Partington. "It is always difficult to predict the impact of these rises on the market, but we're all aware that household budgets are currently being stretched by rising prices across the board."
Suppliers agree. First Drinks Brands managing director Chris Mason says: "We know [pricing] is going to get higher. Duty is going to go up and we know the cost of raw materials is going to increase. I'm presuming these costs will be passed on. As a consequence, we're going to see prices increasing."
The impact of increased costs is bound to vary by sector and supplier, but Scotch whisky offers a good case study. The Scotch Whisky Association reports from member companies hikes in the price of cereals (35-100%); glass (5-20%); copper (20%); and transport (5-15%).
Add these to the 9% Budget excise duty increase, plus the prospect of inflation-plus-2% hikes to 2013, and the
odds are grim - not least because whisky distillers are currently making major capital investments to feed demand from overseas markets.
No wonder the SWA is calling for radical changes: "The SWA believes this [excise duty] policy should be reviewed and that the excise duty system should be overhauled," says the spokesman. "We continue to believe
the fairest approach is to tax all alcoholic drinks on the same basis, according to alcohol content."
The bleak prospects for spirits pricing tend to overshadow emerging consumer trends, such as premiumisation and the polarisation of certain sectors, with cheapest-on-display products and luxury bottles simultaneously enjoying growth.
Atkinson views the premiumisation trend as a chicken-and-egg situation. "A number of commentators were saying on the one hand the supermarkets were trying to trade up, and on the other hand the consumer was trading up. Who was leading that I don't know."
The trend, he ventures, was partly being driven by retailers introducing new, premium own-label spirits which enjoy far fatter margins than traditional own-label fodder or cheapest-on-display. "That move up has been across the food sector as a whole," Atkinson points out. "But how that move up is going to work out in a recession I just don't know."
A major part of the justification for excise rate increases is, of course, the debate over alcohol-related health issues, and the lobbying of government by pressure groups. There's no sign of that lobbying going away. Alcohol Concern, for example, continues to call for minimum pricing legislation in the on and off-trade, in the words of chief executive Don Shenker, to "protect the integrity" of alcohol taxes and combat the power of the supermarkets to maintain low pricing.
But Partington points out
that ignores the uncomfortable fact that EU countries such as Spain have far lower duty rates - and far fewer problems with alcohol misuse. "Pricing is clearly not the issue," he concludes.