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4-2017

Global hop market

A local alternative to mass beer suggested by independent brewers has been successful and is now altering the global market. Beer is becoming more diversified, so transnational companies have to accept the new game rules and to switch focus to young and fast growing markets. All these processes increased the demand for aroma and bitter hop as well as their acreage expansion on two continents. However now there appeared a downward trend of alcohol consumption in the world, so even special sorts can soon turn to be sufficient. In this connection the dynamic American hop market is already facing some problems. EU hop producers have become more cautious, they are not racing to exceed the demand and look forward with more confidence, judging by the contract terms. 

Hop Market in Russia

Germany still dominates the Russian market, yet over the recent two years one has been able observe a continuous success of Czech hop suppliers. Their expansion and growing popularity of hops from the United States became the drivers of supplies growth in 2016 despite the preceding modest harvest crop in the EU, as well as the factor of relative stability in 2017. In this connection, in 2017, the ratio of the varieties continued to shift towards the aroma ones, and the supplies of Magnum hop and other alpha varieties were reduced. However, the import of bitter hop pellets is partially replaced by extracts, especially from the major beer manufacturers. Total volumes of alpha acid supplies, according to our estimation, decreased by approximately 5% and returned to the level of 2015. Barth Haas Group continues dominating the hop products market; HVG also increased its weight. At the same time, Morris Hanbury significantly reduced the supplies in 2017.

CAMRA to lobby for lower duty on 3.5% beers

The Campaign for Real Ale (CAMRA) hopes to work with the Government to secure a change in EU rules to allow a lower duty rate on beers below 3.5% abv.
The Government is committed to reducing duty on beers below 2.8% abv in the March Budget but EU rules currently restrict that rate being extended.
CAMRA has welcomed the move but “would like the 2.8% threshold increased to around 3.5% abv and hopes that the UK Government will work with CAMRA and the wider industry to secure a change in EU rules to make this possible”.
However, CAMRA voiced its opposition to plans to increase duty on beers above 7.5%. The Government’s aim is to increase the price of super strength lagers, such as Carlsberg Special Brew, but CAMRA said it would also hit craft beers not associated with binge drinking.
“This could discourage production of higher strength Belgian style beers and vintage British ale styles,” it said in its Budget submission to the Treasury.

Long-term freeze
The Group repeated its call for an end to the 2% above inflation duty escalator and called for a “long term freeze” on beer duty.
It highlighted that the Labour Government increased duty on beer by 60%, compared to a 25% increase on spirits — leading to “cheap spirits becoming ever more affordable compared to beer”.
It told the Treasury that beer directly supports 400,000 jobs and generates over ?7bn in tax revenue. “Beer is also vitally important to the survival of pubs and therefore the wellbeing of communities and individuals,” it said.
“The jobs, tax revenue and social benefits of beer are under threat due to unprecedented increases in beer tax.”

16 Feb. 2011

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