More Beer Inventory at Risk of Going 'Out of Code'

National Beer Wholesalers Association's Beer Purchasers Index for August stands at 46 and the "at risk" inventory is at 54.

Why it matters: The August data marks a notable shift from previous readings for the "at-risk" inventory measure, now over 50, indicating more inventories are at risk of going out of code over the next 30 days. "At-risk" indicates a product is at risk of expiring. This is an expected outcome as higher inventory levels are typically associated with lower orders, NBWA says.

What's Behind It:  Continued inflationary pressures, extreme heat and a slowing economy bring the industry to a third month of pause after five months of positive ordering trends, NBWA says.

Looking across the segments for August (an index of 50+ indicates volumes are expanding, below 50 that volumes are contracting):      

• The imports index stands as the only beer segment in expansion territory with a reading of 63 in August 2022, slightly lower relative to the August 2021 reading of 66.
• The craft index at 28 is well below the August 2021 reading of 59.
• The premium lights index posted a reading of 38, below the August 2021 reading of 57.
• The premium regular segment index is at 33, below the August 2021 reading of 41.
• The below premium segment is at 42, which is slightly higher than the August 2021 reading of 37. For a thrid month, this is the only segment to see an increase year-over-year.
• The FMB/seltzer index took another big hit, falling to 31 in August 2022 from the August 2021 reading of 58.
• Finally, the cider segment remains below 50, with the August 2022 results at 26 compared to August 2021's reading of 43.