The alcohol ban in South Africa prohibits the manufacturing, distribution, and sale of alcohol.
A last-minute concession from the National Command Council that “harvesting and storage activities essential to prevent the wastage of primary agricultural goods” would be allowed, has enabled the wine industry to resume making wine, promising an ‘exceptional vintage’, once the lockdown is over.
Unfortunately, this is not the case for all sectors of alcohol manufacturing, especially those that can’t rely on ageing in their production plants to increase the quality of their products.
SAB recently submitted a proposal to government arguing for the reinstatement of alcohol sales. They compared the current ban to the prohibition in America between 1920 and 1933, stating that preventing the legal sale of booze would only grow the black market.
This isn’t the only reason that the largest beer brewer in South Africa wants the ban lifted, or at least amended in some regards. If it continues, they’ll have to destroy up to 130 million litres, or to put it differently 400 million bottles, of beer.
Business Insider reports:
SAB has not been brewing since March 23rd, nor has it or transported beer since the start of the hard Covid-19 lockdown on March 27th.
As we transitioned to alert level 4, a pared-down workforce has been fermenting and bottling beer. SAB isn’t allowed to store beer at its brewery past a certain capacity, which it will soon surpass.
Savanna News notes that as a result of this SAB could looking at a “record-breaking estimated R150 million” in losses.
“Urgent action is needed to avoid material financial losses to both the government and SAB, as well as significant job losses. This would literally be pouring that tax revenue down the drain, at a time when government – and the citizens of South Africa – have an urgent need for those funds” the company said in the document.
If SAB destroys 400 million bottles of beer, the consequences will reach beyond financial deficits.
- The company will be forced to operate at 50% capacity for four months.
- No bottling or distribution could take place, given that the beer is discarded.
- This would mean the loss of about 2,000 jobs – half of SAB’s frontline workforce.
- Government excise duty loss of around R500 million
- Disposing beer of such quantity possesses a massive environmental risk.
SAB has committed to working with law enforcement to ensure the safe transport of the beer, should government concede their request to move it to their storage depots.
If this fails, within the next two days, the beer will be destroyed.
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