Ball Fallout: Prices to Rise Almost 28% for 12 oz. Cans, In Addition to 1M per SKU Order Minimums
The fallout from Ball Corporation’s updates to craft brewers and other small customers about increased minimum order quantities continues to reverberate.
In addition to Ball raising minimum order quantities for printed cans from one truckload (204,000 cans) to five (1,020,000 cans), the price of 12 oz. cans will increase nearly 28%, from $93.23 to $119.11 per 1,000 cans, according to an updated pricing sheet obtained by Brewbound.
The price of 16 oz. cans will increase 19.5%, from $134.88 to $161.15 per 1,000 cans, according to the same sheet.
Other customer policy changes from Ball include the discontinuation of warehouse storage of cans for customers. One brewer told Brewbound that Ball would provide storage for no more than six months and would offer minimum order quantities of 30,000 cases of cans (720,000 cans).
“These changes, if accurate and widespread, have the potential to change the entire beer landscape for small and independent brewers,” Brewers Association (BA) president and CEO Bob Pease told Brewbound in a statement. “Most breweries cannot order or store 1 [million] cans per SKU. Having to go to labeled cans and adding broker fees will drive up prices for small brewers and make their products less cost competitive versus larger brewers, who already have scale advantages.”
During Ball’s Q3 earnings call, the company said it is oversold by 10 billion units in its three main regions, with the majority coming from North America. The popularity of can packaging has increased for years among brewers and non-alcoholic beverage makers, but spiked during the COVID-19 pandemic when the widespread closure of on-premise bars, restaurants and venues shifted drinking occasions to homes. Couple that with the rise of hard seltzers, ready-to-drink canned cocktails and aluminum tariffs and the country’s can supply has been crunched from all directions.
In an email to customers obtained by Brewbound, Ball VP of commercial Shirley Ultrich counted the rise in raw material costs, trade policies, supply chain disruptions and disruptions caused by “increasingly severe weather events” among drivers of the new policy.
“We continue to make every effort to manage and mitigate external impacts to our customers, while we take steps to leverage Ball’s unmatched plant network and substantially increase our production capacity to better support our customers’ needs,” she wrote. “At the same time, the beverage packaging industry has not been immune to these economic impacts, and can supply volumes remain constrained as costs are rising across our supply chain, resulting in necessary increases in Ball’s 2022 pricing.”
For the first nine months of 2021, Ball’s North and Central America beverage packaging division recorded earnings of $519 million on sales of $4.3 billion, compared to $544 million (-4.59%) on sales of $3.8 billion (+13%) during the same period in 2020. Globally across all business divisions, Ball recorded net earnings of $581 million on sales of $10.1 billion, compared to $358 million (+62.2%) on sales of $8.7 billion (+16%) for the same period in 2020.
During the company’s Q3 earnings call earlier this month, Ball CEO and chairman John Hayes said it would explore price increases on “a case-by-case basis,” and the publicly traded company termed renegotions of contracts with its clients “cost recovery” conversations.
In its November/December edition of the New Brewer, which was published today, the BA pointed out that Coca-Cola has decided to shift packaging of its Dasani bottled water from plastic to cans. BA technical brewing projects manager Chuck Skypeck said the move will use 1 billion cans annually, which amounts to the same number of cans about 1,000 average size craft brewers combined would need each year.
A Ball spokesperson declined to comment on customer supply arrangements.
Beers of the World Founder Anthony Angotti Dies at 81
Anthony Angotti — founder and CEO of Angotti Beverages and Beers of the World — died last week at the age of 81, the Rochester Democrat and Chronicle reported.
Angotti founded Angotti Beverage Corp in 1982 in Batavia, New York, with the “vision of making a retail and wholesale empire that would specialize in introducing beer drinkers to imported and domestic beverages,” according to the Beers of the World website. After obtaining wholesaler, importer and retailer licenses, the first Beers of the World location was added in Brighton in 1987, which was replaced in 2010 by a flagship location in Henrietta, where Angotti lived for more than 50 years.
The Beers of the World stores are known for a variety of imported and domestic beers. Angotti is often credited with educating both casual consumers and industry professionals on the diversity of beer styles, as well as producers.
Susan Clapper, Angotti’s daughter, told the Rochester Democrat and Chronicle that the business, now headquartered in Rochester, will remain in the family.
Angotti is survived by his wife Beverly Angotti, two daughters, three grandchildren, and two great granddaughters. In lieu of flowers, the family is asking donations be made to the American Wheelchair Mission.
Hawaii Stream Smelling of Beer Registers 1.2% ABV
A stream in Oahu, Hawaii registered a 1.2% ABV last week, after being contaminated by runoff with high amounts of drinking alcohol, Hawaii News Now reported.
The issue was discovered by a local hiker, and reported by Carroll Cox, an environmental activist, who informed the Hawaii Department of Health of a strong beer smell coming from the water. He likened the smell to “a beer pub that hadn’t opened its doors for three of four days.”
An investigation traced the contamination to a spill from a Paradise Beverages liquor and beer warehouse across from the H-2 Freeway, which traveled through a storm pipe owned by the Department of Transportation.
Hawaii News Now tested a sample of the water with FQ Labs, and along with the ABV content, discovered the water also contained 0.4% sugar.
Paradise Beverages told Hawaii News Now that they are cooperating with the state’s investigation. The source of the spill has yet to be reported, but the Health Department said it has stopped.