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Liquor licenses applications surge

Webdev Author 6 Jan 2012

According to a Government Gazette published during the first week of December last year, 34 applications for liquor licences were lodged across the country, representing increasing interest by investors to tap into the growing demand for beer.
Zimbabwe has recovered from a decade long economic contraction although the economy is still fragile.
A significant number of jobs have been created since dollarisation in 2009, reigniting demand for luxuries like beer, according to a recent report by the Zimbabwe National Statistics Agency.
Harare, Matebeleland, Masvingo and the Midlands provinces constituted the bulk of applications for liquor licences published in the Government Gazette.
Under Zimbabwean law, all persons who have objections to applications submitted by new bar operators can lodge their complaints to the liquor licensing board in writing. The overflow of applications for new outlets came as Zimbabwe’s largest brewers, Delta Beverages, reported a jump in beer volumes consumed during the first six months to September 30, 2011. The company attributed the increase in beer consumption to improved performance in agriculture after the tobacco, maize and cotton seasons registered improved output, which translated to increased disposable incomes to farmers.
The Zimbabwe Stock Exchange-quoted company recorded a 23 percent rise to 3,427 million hectolitres in aggregate beer volumes driven by a strong demand in clear beer. Sorghum beer according statistics released by Delta has continued to dominate the market, indicating the low incomes prevailing on the economy.
The company last year announced that it had ordered and paid a deposit for a new lager beer packaging line for its Southerton bottling plant in Harare.
The plant is expected to be commissioned by August this year.
The volume of opaque beer produced by Delta during the first six months of its financial year grew to 1, 78 million hectolitres almost doubling the 945 000 hectolitres for clear beers.
During the past year Delta launched the 660 millilitres “Magnum” with consumer acceptance exceeding the company’s forecast of 1, 2 percent market share. Shortages of pints during the holidays could have also driven demand for the “Magnum”.
Pan African investment company, Renaissance Capital, said in a research note late last year that Sub-Saharan African beer consumption is set to increase, with the continent’s brewery sector set to increasingly become attractive for investors.
RenCap projected strong growth in Zimbabwe, in which Delta Corporation, which makes Castle, Lion, Pilsner and other lager brands, controls almost 90 percent of the market.
“With rising income levels and increasing rates of urbanisation, we expect commercial beverages to continue gaining market share. This should support strong volume growth for the sector,” said the RenCap.
Most of Delta’s peripheral competitors, such as Rufaro Marketing, once a dominant liquor trading arm of the Harare City Council, have collapsed, created a supply gap that has been taken over by Delta’s brands.
Pungwe Breweries and Marketing, a private liquor and brewery concern wholly-owned by the City of Mutare, was on the market in 2010 scouting for a partner to help it maximise capacity utilisation from about 20 percent to 100 percent.
Other local authorities-run beer businesses have faced similar problems. These include the Kadoma Liquor Marketing, Kwekwe Breweries, Go-Beer Breweries, Ingwebu Breweries and Dandaro Marketing.
Most, if not all, of the local authorities-owned breweries are predominantly manufacturers of the so-called opaque beer. But Chibuku Breweries, owned by Delta Corporation, remains a dominant market player in the sorghum beer market with about 15 breweries spread across the country.
Ends