Global hop marketA 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 RussiaGermany 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.
10+1 trends of Russian beer market 2015-2017Despite of the moderately negative prognoses for 2017, the beer market can be stabilized soon. Yet the years of the negative dynamics have resulted in marketing being limited just to “optimization” and the art of balancing between price and volumes. Bigger supermarkets share means stronger trade marketing. These processes are connected to the majority of the described trends. At the same time, the federal brands inflation leads to searching for new tastes, sales channels and contact formats that expand the product range and diversify the beer market, but do not imply a substantial volume increase. Let us enumerate and further discuss the ten trends of the beer market we can see in 2015-2017 as well as the major event of 2017.
Beer market of Ukraine 2017In the first half of 2017, the Ukrainian beer market goes on decreasing slowly. Yet, the companies manage to compensate their lost volumes by raising prices and improving the sales structures. This results in the mid price market segment reduction while the sales of premium brands are rising. These processes are connected to position strengthening of companies Carlsberg Group and Oasis and the market share reduction of Obolon. Most of the novelties by the market leaders belong to craft or hard lemon categories.
Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
UK: Beer exports up 24% in 2010
Despite the tough economic climate, beer exports were up by 24% in 2010, increasing in value to over half a billion pounds (?544 million), according to the new HM Revenue & Customs export data. The rise equates to 230 million extra pints of British beer exported.
However, the BBPA is warning that Government plans for huge beer tax rises in the Budget on 23rd March would be a major blow to further growth, investment and innovation in a sector on which over 70,000 UK jobs depend, which has witnessed a huge growth in the number of breweries in recent years.
BBPA Chief Executive Brigid Simmonds comments:
“These huge increases in beer exports are something to proud of. There is nothing to match the unique taste and variety of British beer, and overseas beer drinkers clearly have a growing taste for it. With UK exports so vital to our economic recovery, the huge growth in the number of breweries in Britain means we are sowing the seeds now for the British export champions of the future.
“However, punitive new taxes from the Government, which plans a seven per cent tax in beer duty this March, will hold us back. We need a climate that encourages the innovation and investment that will ensure future export growth. Huge rises in beer taxes will have the opposite effect.”
UK Beer Exports 2009: 5,486,368 hl
UK Beer Exports 2010: 6,797,422 hl
Increase: 1,311,054 hl (up 24 per cent)
Value of Exports: ?544 million (up 18 per cent)
1 hectolitre equals 176 pints. Exports will include intra-company trade.
The British Beer & Pub Association is the UK’s leading organisation representing the brewing and pub sector. Its members account for 96 per cent of the beer brewed in the UK and own nearly two thirds of Britain’s 52,500 pubs.
According to a study published in February by Oxford Economics for the BBPA, 72,000 UK jobs depend on the brewing industry and a million jobs on beer and pubs as a whole.
The BBPA submission on the Government’s Budget plans and proposed Beer Tax rises, is available on the BBPA website. Key highlights:
• Scrapping plans for above inflation duty increases would save over 10,000 jobs (Oxford Economics)
• Freezing duty would generate up to ?40 million in extra tax revenues.
• The recent VAT rise will encourage drinking at home, and results in the loss of over 8,000 beer-related jobs.
(Source: British Beer & Pub Association)
10 Mar. 2011