(Bloomberg) -- Shares of Asahi Group Holdings Ltd. gained after the Japanese brewer said it will raise prices for its Super Dry beer and other beverages for the first time in years, joining Lawson Inc., McDonald's Holdings Co. Japan and other companies facing rising production costs.
The price hike, which includes kegs, Yoichi whiskeys and other beverages, will take effect for shipments from Oct. 1, the Tokyo-based brewer said in a statement Tuesday. Retail prices will increase 6% to 10%, a spokesman said.
Asahi shares rose 4.3% in Tokyo, their biggest advance in almost seven weeks. Rival Sapporo Holdings Ltd. jumped 7.4% and Kirin Holdings Co. climbed 2.7% on expectations they may follow suit.
“Similar industries will see Asahi's hike as an opportunity to raise their own prices,” said Tomoichiro Kubota, a senior market analyst at Matsui Securities in Tokyo. “The market will evaluate whether companies can pass on higher costs to consumers.”
Although consumers in rich economies across the world have been experiencing the impact of inflation for more than a year, shoppers in Japan have become accustomed to flat prices, and even deflation, for the better part of three decades. Energy costs are also on the rise, and the recent weakness of the yen is also pushing up costs for imported goods, contributing to price hikes.
“We expect that the various costs associated with production and logistics will continue to rise, and it will be difficult to offset these increases,” Asahi said. The brewer last raised canned beer prices in 2008, while bottles and kegs became more expensive in 2018.
Earlier this month, convenience-store operator Lawson said it will raise the price of its popular “Karaage-Kun” chicken nugget snack for the first time in 36 years, by 10% to 238 yen ($1.86). McDonald's, which once slashed the price of its burger to as little as 59 yen in 2002, said in March that it will add 10 to 20 yen to prices of some products, citing higher costs for beef, wages and transport.
Cup Noodle King Shows Japan a Path to Price Hikes: Taking Stock
Asahi blamed rising costs for everything from ingredients including malt and corn to packaging materials like aluminum and cardboard as well as transportation, for its price hikes.
Read more: Bank of Japan Likely Sees Strongest Inflation in 30 Years
The government of Prime Minister Fumio Kishida, facing an upper house election this summer, is preparing economic measures to cushion the impact of inflation on households and businesses.
“At the moment, what we are seeing is cost-push inflation,” said Hiroyuki Ueno, a senior strategist at Sumitomo Mitsui Trust Asset Management in Tokyo. “The key here is whether companies will start raising wages.”
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