Business / Companies
Delta rules out beer shortage over this festive season
01 Dec 2012 at 05:28hrs | Views
DELTA Beverages has ruled out the possibility of beer shortage this festive season despite the intermittent power and water supplies at its plants in Harare and Bulawayo.
The festive season is usually characterised by high demand for beer.
Responding to written questions from Business Chronicle, Delta Beverages director of corporate affairs Mr George Mutendadzamera said it was unlikely that there would be beer shortages during the festive season.
"We are unlikely to experience any shortages of beer this festive season, the intermittent supplies of water and electricity that continue to disrupt production which may affect supplies if they become prolonged," said Mr Mutendadzamera.
He said the increased price of beer at retail outlets arose from the upward revision of excise duty on clear beer.
"The price increases arising from excise duty have been implemented at 80 cents for pints and $1,55 for quarts although Delta Beverages has absorbed the duty increase on cans and non refundable bottles," he said.
Mr Mutendadzamera said the company would have preferred that the duty remained at current rate of 40 percent or even be reduced to levels in line with regional markets.
"As much as we could have appreciated that excise duty on clear beer remain at current levels or even be reduced, we however understand the pressures on the Minister of Finance (Tendai Biti) in drafting the budget to raise additional revenue," he said.
He said Delta Beverages has invested in increasing production capacity and would continue with productivity enhancing programmes despite the increase in excise duty.
The increase in excise duty for clear beer comes at a time when the beverages and soft drink producer recently commissioned an $8 million bottling plant. The plant has increased its production capacity from 60 000 hectolitres to 75 000 hectolitres per month.
Presenting the 2013 national budget, the Finance Minister proposed to review upwards the rate of excise duty of clear beer from 40 percent to 45 percent as a revenue enhancing measure.
"The rate has not been reviewed since 2004, in order to allow ample time for the business to re-invest in new plants and equipment.
"As a result, significant investment in bottling and ancillary plants has been injected since the adoption of the multi-currency regime in February 2009. Volumes of beer sales have, thus grown by about 270 percent from 2009 to 2012," said Minister Biti.
The festive season is usually characterised by high demand for beer.
Responding to written questions from Business Chronicle, Delta Beverages director of corporate affairs Mr George Mutendadzamera said it was unlikely that there would be beer shortages during the festive season.
"We are unlikely to experience any shortages of beer this festive season, the intermittent supplies of water and electricity that continue to disrupt production which may affect supplies if they become prolonged," said Mr Mutendadzamera.
He said the increased price of beer at retail outlets arose from the upward revision of excise duty on clear beer.
"The price increases arising from excise duty have been implemented at 80 cents for pints and $1,55 for quarts although Delta Beverages has absorbed the duty increase on cans and non refundable bottles," he said.
"As much as we could have appreciated that excise duty on clear beer remain at current levels or even be reduced, we however understand the pressures on the Minister of Finance (Tendai Biti) in drafting the budget to raise additional revenue," he said.
He said Delta Beverages has invested in increasing production capacity and would continue with productivity enhancing programmes despite the increase in excise duty.
The increase in excise duty for clear beer comes at a time when the beverages and soft drink producer recently commissioned an $8 million bottling plant. The plant has increased its production capacity from 60 000 hectolitres to 75 000 hectolitres per month.
Presenting the 2013 national budget, the Finance Minister proposed to review upwards the rate of excise duty of clear beer from 40 percent to 45 percent as a revenue enhancing measure.
"The rate has not been reviewed since 2004, in order to allow ample time for the business to re-invest in new plants and equipment.
"As a result, significant investment in bottling and ancillary plants has been injected since the adoption of the multi-currency regime in February 2009. Volumes of beer sales have, thus grown by about 270 percent from 2009 to 2012," said Minister Biti.
Source - TC
