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Copycat fraudsters create export barrier for UK brewers

Brewers sending their beer overseas are at risk of copycat manufacturers producing fraudulent products
Brewers sending their beer overseas are at risk of copycat manufacturers producing fraudulent products

Copycat manufacturers producing fraudulent UK beers are a big barrier to small brewers exporting their products to China, according to the boss of the Society of Independent Brewers (SIBA).

Julian Grocock, ceo of SIBA, told FoodManufacture.co.uk: “If people sell lager with a foreign name it has to be from that country. In our industry we are fairly good at adhering to that and if a small brewer exports it is likely to be labelled as craft beer and with its country of origin on it.  

“We know that the Chinese are very good at that [counterfeiting products] so it is a problem. I have seen film of a batch of Corona being identified as fraudulent.”

Although the UK government had carried out a review of UK duty fraud and discovered the beer industry was at risk of its products being counterfeited, one solution to the problem would hinder small firms, claimed Grocock.

“The government was thinking of bringing in UK duty stamps, but the cost of applying these to products would prohibit small brewers from exporting,” he said. “So I don’t think they will come into place.”

‘Exclude exports from Small Breweries Relief’

Grocock also called on the government to exclude exports from Small Breweries’ Relief to prevent them losing out on money when exporting, another obstacle to selling overseas.

Currently brewers that produce less than 5,000hl a year (60 barrels a week) receive 50% relief. Grocock said firms that increase capacity, so that they could export, would be in danger of losing this relief and might therefore be deterred from entering new markets.

However, UK brewers shouldn’t be put off by the challenges of exporting and instead look to grow their businesses overseas as a way to overcome the increasingly competitive UK market, Grocock claimed.

“We are looking at an over competitive UK market, with over 1,000 brewers and a diminishing pub market. There is a definite trend and exports might be the next big thing. The more mature brewers are thinking ‘where else could I grow my business’?”

Grocock said that although the innovation of plastic kegs had meant small brewers could export kegged beer without needing to wait for the keg to return, smart brewers would export bottles as they don’t create the same health and safety challenges as kegs.

“Cask is not easy to export because it spends a long time fermenting and only has a short sell-by date and that creates problems with adhering to other countries health and safety standards,” he said. “Many are looking to produce only bottles because they are easier to export and keep longer.”

A recent survey of SIBA’s members found that 21% of brewers currently export beers, with 58.5% saying a SIBA-led export trade visit could help them grow their business.

There are currently no plans for SIBA to undertake a trade visit, however it has secured representatives from a number of countries to speak to brewers about export opportunities at its BeerX conference in Sheffield next month, Grocock claimed.

Representatives from Vietnam, Mexico, South Africa, Spain, Serbia, Sweden, Canada and the US will all be at the event.

Reduce export costs

64% of respondents to the survey believed a joint hub that dispatched bottled beer from a coalition of brewers out to a number of overseas markets would help reduce export costs.

81% of those surveyed said finding export agencies would help, 76% would like help finding potential markets and 64% said they could benefit from help understanding the financial implications of exports.

Annual exports for all UK brewers stand at 6.4Mhl, worth around £567M, according to SIBA.

Meanwhile, earlier this month Yorkshire-based Ilkley Brewery exported to China for the first time.

Ilkley Brewery, which already exports to Scandinavia and America, sent 100 cases of beer to be distributed to independent retail outlets across the country.

Chris Ives, md of the business, said: “This initial Chinese order is just one pallet so we’ll be very keen to hear how well it sells and what the Chinese craft beer market makes of our Yorkshire ale. If it’s well received, we could be looking at high volumes for future orders.”

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