Glass half empty for Germany's proud beer industry

Fri Apr 18, 2014 4:19am EDT
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By Madeline Chambers

FREISING, Germany (Reuters) - Behind the pale yellow walls of a former Benedictine monastery on a wooded hill near Munich, the master brewers of Weihenstephan are still perfecting their art after nearly 1,000 years of making beer.

Since Saint Corbinian and his monks first created a golden, nourishing beverage from local hops, the world's oldest brewery has withstood fires, plagues, plundering foreign armies and secularization.

Weihenstephan's cosy brew house, dominated by four steel vats of foamy brown liquid and infused with the sweet smell of malt, embodies a proud beer culture that culminates every year in Munich's Oktoberfest folk festival - a 16-day homage to beer.

Yet for many German brewers, the good times are over.

A slump in consumption of more than a third in the last 25 years has hit Germany, Europe's biggest beer producer, triggering intense competition and price discounting.

With young Germans turning to spirits and non-alcoholic fruit drinks, beer sales fell 2 percent last year alone.

Traditional family breweries, also under pressure from double-digit rises in energy, glass and malt costs, are struggling, some dying.

"We're in an extremely tough market," Weihenstephan boss Josef Schraedler told Reuters. "You can't grow here unless you lower prices or .. develop a cult brand and charge a premium."   Continued...

A visitor reaches for of the one of the first mugs of beer after the tapping of the first barrel during the opening ceremony for the 180th Munich Oktoberfest in this September 21, 2013 file photo. REUTERS/Michael Dalder/Files