Beer Purchasing was down in June, with FMB, seltzers falling back to earth

The National Beer Wholesalers Association (NBWA) released the Beer Purchasers’ Index (BPI) for June 2021, a month that experienced widespread economic shutdowns, on-premise closures and the over-indexed segments that took a hit in those channels. The June 2021 overall reading of 70 falls 11 points below last June’s reading of 81.

A significant directional shift was shown in the FMB/Seltzer segment with a 25 point drop, decreasing from a reading of 94 in June 2020 to 69 in June 2021. The “at-risk” inventory measures for FMB/Seltzers also broke a new milestone posting an index above all other segments in the industry. Note, the FMB/Seltzer segment is still expanding and growing, as indicated by the above 50 reading.

NBWA Chief Economist Lester Jones explained: “The lower index relative to June 2020 indicates that more distributors are reporting they are ordering “about the same” amount of product as the same time last year. This is not a big surprise as the segment has experienced significant amounts of distribution growth over the past 12 months.”

BPI is the only forward-looking indicator for distributors to measure expected beer demand. The index surveys beer distributors’ purchases across different segments and compares them to previous years. A reading greater than 50 indicates the segment is expanding, while a reading below 50 indicates the segment is contracting. Measures for “at-risk” inventory (inventory at risk of going out of code in the next 30 days) are still below 50, signaling continued supply constraints in the system.

Looking across the segments for June:

• The index for imports continued into expansion territory with a reading of 72 in June 2021, slightly above the 66 reading from June 2020.
• The craft index posted a reading of 53 for June 2021 compared to a contracting reading of 46 in June 2020. This is the third monthly reading above 50 for the craft segment.
• The premium lights segment posted a reading of 59, well below the June 2020 reading of 75.
• The regular domestic beer segment index at 40 is significantly below the June 2020 reading of 62.
• The below premium segment at 35, took another significant hit year-over-year from last June’s reading of 65.
• The FMB/seltzer index is the big news for June. This segment took a big hit, falling 25 points from 94 in June 2020 to 69 in June 2021.
• The cider segment remains below 50 with a reading of 40 in June 2021 compared to 37 in June 2020.