「经济学人」Alcoblocks

A quirk of regulation is holding back growth in the British market

Not that long ago asking for an alcohol-free beer in a British pub made you seem weird. Less so now. Alcohol consumption is falling among young, affluent and health-conscious consumers. Better brewing techniques have introduced tastier non-alcoholic options. Sales of alcohol-free beer rose by 26% in 2022.

Even so, the overall market is still tiny. Non-alcoholic beverages make up a sliver of Britain’s booze market, at just 3%. That is comparable to the share in France and America but far behind that in Germany (16%) or Spain (11%), according to the iwsr, a research firm. Sales growth of alcohol-free drinks would need to exceed 40% each year to come close to raising their market share above 10% by 2030, according to the Social Market Foundation, a think-tank.

Wider availability and better products will naturally help the market to grow. But so would ironing out a specific wrinkle in the British market. According to standards set by the Department of Health and Social Care, drinks must contain less than 0.05% alcohol by volume (ABV) to be considered alcohol-free. That is less than the alcohol content of burger rolls or ripe bananas. It is also much less than in comparable markets. The 0.5% ABV beers made by Big Drop, a British craft brewer, are officially deemed non-alcoholic in America, Australia and Germany but not at home.

This stringent standard has two consequences. One is for competition. Complying with the guidance is hard for smaller brands in particular: producing drinks at 0.05% ABV or less requires expensive equipment to extract the alcohol. Many don’t even bother trying. Nearly one-third of the drinks sold and labelled as alcohol-free in Britain ignore the official guidance, according to the Office for Health Improvement and Disparities, a public-health policy body. That leads to the second consequence: confusion. More than half of respondents in a poll by Opinium, a research firm, said there was a lack of clarity over the suitability of non-alcoholic products for pregnant women, drivers and people who don’t drink for religious reasons.

The government, keen to give more options to people who drink to excess, has launched a consultation on updating its rules so that drinks with 0.5% ABV can rightfully claim the alcohol-free descriptor. A labelling change is not going to make the market go crazy but it would bring Britain into line with other countries. And it might make it even easier to order something non-alcoholic next time you are at the bar.(May 21st 2024)

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