Agreement halts plan to pour millions of litres of beer 'down the drain'

South African Breweries (SAB) has reached an agreement with the government to avoid having to pour millions of litres of beer down the drain because it could not be transported under lockdown.

The company warned last week that it may have to dump 130-million litres of beer, about 400m bottles worth, that had accumulated at its brewing facilities, which had run out of space to legally store more.

The news was greeted with disbelief by many on social media. Images of beer being poured “down the drain” in Pretoria were shared on social media on Friday.

SAB confirmed that it had started dumping some of its inventory.

This week the parties agreed on a solution that will enable SAB to safely transport its packaged inventory, both alcoholic and nonalcoholic, from its breweries to its depots.

“Warehouses at SAB’s seven breweries are now at full capacity and unable to absorb any further inventory, which affects any current beer in the production process being bottled and stored, culminating in the destruction and disposal of the inventory,” SAB said in a statement.

“To overcome the problem, SAB has collaborated with the government and reached an agreement which will enable the company to transport its beer inventory over the course of the next few weeks and avoid losses in excise tax for the government to the value of R500m.”

Under the Covid-19 lockdown rules, the sale and transportation of alcohol is banned.

SAB said it was not legally allowed to store brewed beer once it reached a certain capacity. Once breweries reach permissible limits, the alcohol needs to be stored off site.

The distribution and sale of alcohol is will remain restricted under level 4 lockdown regulations.