10% price rise on booze calls for stiff drink

The price of wine and spirits is predicted to go up by five times the rate of inflation in the next year.

The rises will dismay consumers, although health campaigners last night hoped that they might bring Britain's binge drinking problem under control.

The dismal forecast is contained in a report by the Wine and Spirit Trade Association (WSTA), which represents retailers selling alcohol. It estimates that prices per bottle will rise by up to 10%, almost five times the official rate of inflation, which stands at 2.1%.

Those who enjoy a middle of the range bottle of wine can expect to see prices go up by about 50p a bottle.

The increase will be a major shock to consumers in the wake of real-terms falls in prices in recent years. Since 1999, prices of wines and spirits have gone up by 21.5% while inflation in general has risen by 32.6%.

Factors contributing to the price rises include:

&149 Droughts and bad grape harvests in Australia, France and South America, more than doubling wholesale prices in Australia and Chile and increasing French wine prices by up to 30%;

&149 Rising energy costs, including the 50% increase in oil prices affecting transport and the cost of glass manufacture;

&149 The cost of tin and aluminium going up by 90% in the past three years, with paper rising by 40%, increasing the price of packaging;

&149 Green energy policies increasing the price of molasses – a key ingredient of rum – by 50% in the past three years because of the demand for ethanol to power cars as an alternative to oil;

• Grain prices increasing by as much as 130% since 2005, affecting the price of imported whiskies such as bourbon.

Jeremy Beadles, chief executive of the WSTA, said: "I'm afraid we are going to see the costs passed on to consumers. There is simply no more margin to cut. At a time of economic slowdown, there is simply no good news for consumers."

Campbell Evans, the chief executive of the Scotch Whisky Association, warned: "Rising costs of transport and raw materials will affect whisky prices."

Drinkers are already bracing themselves for hard times and planning strategies for how to deal with the price rises.

Roddy Martine, a writer on whisky and a self-confessed bon viveur, said: "It is a pity because with all the grim economic news around at least you'd think you could seek comfort in a drink, and even that will be too expensive."

Dr Tim Palmer, the president of the Inverness Wine Appreciation Society, said: "My response to this would be to start buying it now for consumption later and buying it by the case from independent sellers. Another idea is to look for wines from the more unusual locations, which might not be as affected by high shipping costs as New World wines: for example Georgia, Lebanon and Turkey."

Health campaigners gave the increase a cautious welcome, but called for supermarkets to scrap bulk-buy discount deals on drink.

Tom Wood, the chairman of the Scottish Association of Alcohol and Drug Action Teams, said: "I think that overall it is good news. The World Health Organisation cites price as one of the factors in controlling unhealthy consumption of alcohol. We now have a situation where alcohol is half the price in real terms that it was 30 years ago and that's just not clever."

A spokeswoman for Alcohol Concern Scotland added: "We are concerned that the larger supermarkets will be able to absorb these price rises through their buying power and ability to discount. We are very concerned about the number of 'three for the price of two' offers, and the effect that is having on alcohol consumption."

In recent weeks, ministers have pledged to tackle Scotland's drinking culture as a cause of violence and health problems.

Last night a Scottish Government spokeswoman said: "As a nation we are drinking too much. We need to change and challenge the so-called bevvy culture that is affecting Scotland."