Beer giants’ big profits hard to swallow

Joblessness remains stubbornly high, and drowning your sorrows is getting more expensive.

Big brewers said yesterday that while cash-strapped consumers in the US and Europe are buying less beer, the companies have increased profits by hiking the price for a can of brew.

Anheuser-Busch InBev — which controls nearly half the US market with brands like Budweiser, Stella Artois and Beck’s — said its global quarterly profits climbed 9.1 percent despite declining sales in North America and Europe.

Meanwhile, archrival Molson Coors said its third-quarter profit rose 8.8 percent, boosted by results from MillerCoors, a joint venture with global brewing giant SABMiller that has slashed costs while using its combined US market clout to jack up beer prices.

“The overhang on our category continues to be unemployment of our key beer drinker,” said MillerCoors CEO Leo Kiely. Nevertheless, brewers signaled no plans to raise down-and-out beer drinkers’ spirits by cutting prices. That’s despite the fact that MillerCoors, which accounts for 29 percent of US beer sales, is on track to achieve $750 million in cost savings by 2012.

US beer prices have been rising for more than a year following a big wave of consolidation in 2008, when Belgian conglomerate InBev bought Anheuser Busch, prompting SABMiller and Molson Coors to form their joint venture in response.

That’s in sharp contrast to a few years earlier, when Miller and Bud fought a brutal price war to lure beer drinkers despite a healthy economy.

With InBev and MillerCoors now controlling more than three-quarters of the US market, industry observers say an antitrust crackdown may be looming. [email protected]