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Tuesday, 6 August 2013

Rising Beer Business

Zambian Breweries (ZB), a subsidiary of SABMiller Africa, is set to commence construction of a K110m (US$20m) Chibuku manufacturing plant in Lusaka. The construction of the one million hectolitre plant would be undertaken by Krones Contractors. The project is expected to be completed by the end of the year.

This is part of ZB's continuous expansion which has recently seen it officially open its new one million hectolitre plant at Ndola Brewery, following an investment of K500m (US$90m). It has also put up a new Chibuku Plant in Kitwe at a cost of K30m.

The increasing investment of Zambian Breweries in all things alcohol is part of a broader trend in Africa which has seen it become the battle ground for the four big beer giants – France’s Castel, SABMiller, Heineken and Diageo. Africa's rising middle class is poised to drink more and more in the future. With consumption of beer per capita in Africa at eight litres compared with 35 litres in the rest of the world, the market for the future can only get bigger!

Around 75% of the drinks market on the continent is still dominated by cheap home brews or illicit spirits. The beer giants believe many of these consumers can be converted to industrially-produced lagers and spirits as they move up the wealth chain. And of course opaque beer will also not be left behind.

QuestionIs the growth in the beer industry one that should be welcomed or derided? Share in the comments below. 

Chola Mukanga | Economist | Writer
Copyright © Zambian Economist 2013

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