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UniCredit Oktoberfest analysis: Wiesn inflation remains above the 3 percent mark

"O'zapft is" - ("the keg's tapped"). When those words echo across the Wiesn fairground in Munich on Saturday, ushering in the 184th Oktoberfest, visitors to this year's event will have to dig a little deeper than last year. Again this year, prices at the Wiesn are higher. The average price for one "Mass" of beer in 2017 will be EUR 10.83 - a year-on-year increase of 29 cents. The traditional UniCredit Wiesn Visitor Price Index (WVPI) shows a 3.1% increase this year. The index, which is based on the price for two litres (two "Mass") of beer, half a grilled chicken and a public transport ticket, is part of the UniCredit analysis report "Oktoberfest 2017: beer liquidity to remain ample" published today.

 

Although the WVPI is lower than last year's high of 3.5%, it is still above the 3% mark, and is thus significantly higher than the overall consumer price trend in Germany. But while prices at the Oktoberfest continue to defy gravity, another trend has been reversed. In the past, the per capita consumption of beer has steadily risen - from around 0.9 litres in 1985 to a peak level of 1.3 litres in 2015. Last year, however each visitor drank an average of just 1.18 litres.

 

"It will be interesting to see whether the substantial increases in beer prices may have a longer-lasting impact on Oktoberfest beer sales, and whether the latest downturn in per capita beer consumption reflects more of a structural change in consumer behaviour", said Dr. Thomas Strobel, the UniCredit economist who authored the report. However, a decrease in beer prices is unlikely, even with the drop in consumption.

 

In view of the limited competition at the Oktoberfest, downward pressure on beer prices is rather limited. Under a long-standing tradition, only Munich beer can be tapped in the Wiesn beer tents. Moreover, the tent operators must meet stringent standards. There are only six Oktoberfest breweries. And again this year it is unlikely that the rising costs will deter visitors from their Wiesn fun.

 

 

Munich, 14 September 2017

 

 

Press Contact:

 

Nicholas Wenzel
Tel.: +49 89 378 44959
E-Mail: nicholas.wenzel@unicredit.de