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Study: Climate Change Could Cause Price of Beer to Double, Decrease Consumption 16%

By Craig Bannister | October 18, 2018 | 9:43 AM EDT

Climate change may cause the global price of beer to double and consumption to plummet, a new study involving the University of East Anglia concludes.

The study, billed as the first of its kind, published in international science journal, warns that beer prices could “on average, double” due to climate change. And, even under the best-case climate scenario, prices will “jump by 15%.”

For example, in Ireland, which boasts the highest per-capita consumption of beer, the price of beer is projected to rise by as much as 193% due to climate change.

Global consumption of beer is expected to decline by at least 4%, and by as much as 16% (a decline in volume equivalent to the total U.S. consumption of beer in 2011):

“During the most severe climate events (for example, under RCP8.5), our results indicate that global beer consumption would decline by 16% (0–41%) (roughly equal to the total annual beer consumption of the United States in 2011), and that beer prices would, on average, double (100–656% of recent prices). Even in less severe extreme events (for example, those occurring under RCP2.6 simulations), global beer consumption drops by 4% (0–15%) and prices jump by 15% (0–52%).”

The study says the changes in price and consumption will be caused by decreases in global beer supply due to inadequate production of barley, a main ingredient in beer, brought on by extreme drought and heat:

“Ultimately, our modelling suggests that increasingly widespread and severe droughts and heat under climate change will cause considerable disruption to global beer consumption and increase beer prices.”

“Decreases in the global supply of barley lead to proportionally larger decreases in barley used to make beer and ultimately result in dramatic regional decreases in beer consumption (for example, −32% in Argentina) and increases in beer prices (for example, +193% in Ireland).”

“Future price shocks” caused by climate change will be more a function of a country’s demand for beer, rather than current prices, the study finds, pointing to countries like Ireland and the Czech Republic, where per capita beer consumption averages “a bit more than a six-pack per week”:

“Countries where beer is currently most expensive (for example, Australia and Japan) are not necessarily where future price shocks will be the greatest (Fig. 4e–h and Fig. 5b). Changes in the price of beer in a country relate to consumers’ ability and willingness to pay more for beer, rather than only produce less, such that the largest price increases are concentrated in relatively affluent and historically beer-loving countries. For reference, the US$4.84 (US$1.07–8.49) increase in the price of a 500-ml bottle projected for Ireland under RCP8.5 is equivalent to a price hike of US$20.61 (US$4.55–36.15) per six-pack of 355 ml beer, that is, an increase of about 193% (43–338%) from the average pre-event price (Fig. 4h).

“At the level of individuals in each country, the greatest reductions tend to better align with those countries that consume the most beer per capita in recent year (2011) (Fig. 4i–l). For example, the highest levels of annual per-capita consumption in Ireland and the Czech Republic are 276 and 274 500-ml bottles, respectively (equivalent to about five bottles per week or a bit more than a six-pack per week).”

The study concludes by warning that climate change threatens to deprive the world of an important social component that has endured throughout the ages:

“In conclusion, concurrent extremes of drought and heat can be anticipated to cause both substantial decreases in beer consumption and increases in beer price. The frequency and severity of these extreme events, which are correlated with future increases in mean surface temperature, increase under climate change.”

“For perhaps many millennia, and still at present for many people, beer has been an important component of social gatherings and human celebration. Although it may be argued that consuming less beer is not disastrous—and may even have health benefits—there is little doubt that for millions of people around the world, the climate impacts on beer consumption will add insult to injury.”