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.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
US: Federal small brewer excise tax bills introduced in both chambers of Congress
The Senate bill, S. 534, was introduced on March 9 by U.S. Senators John Kerry (D-Mass.) and Mike Crapo (R-Idaho). Joining Senators Kerry and Crapo were 17 of their Senate colleagues who signed on as original co-sponsors.
S. 534 mirrors the provisions contained in last session’s S. 3339 which gained the support of 28 U.S. Senators. Specifically, S. 534 would reduce the small brewer tax rate on the first 60,000 barrels by 50 percent (from $7.00 to $3.50/barrel) and institute a new rate of $16.00 per barrel on beer production above 60,000 barrels up to 2 million barrels. Breweries with an annual production of 6 million barrels or less would qualify for these tax rates.
“Small brewers have been growing and creating jobs ever since the craft beer revolution began,” said Senator Kerry. “Today there are over 40 small breweries in Massachusetts and 1,700 across the country, and this bill will help ensure that these small businesses keep people on the payroll and create jobs even during tight economic times.”
The Small Brewer Reinvestment and Expanding Workforce Act (Small BREW Act), H.R. 1236, was introduced by Representatives Jim Gerlach (R-Pa.) and Richard E. Neal (D-Mass.) on March 29. Joining them as original co-sponsors are Representatives Earl Blumenauer (D-Ore.), Peter A. DeFazio (D-Ore.), Duncan D. Hunter (R-Calif.) and Erik Paulsen (R-Minn.). Several of these Representatives are members of the House Ways and Means Committee. Like its Senate counterpart, the House’s Small BREW Act would enact a graduated beer excise tax rate of $3.50 and $16.00.
“With the economy sputtering, Congress must create conditions that allow small businesses to become more competitive, protect existing jobs and create new employment opportunities,” Representative Gerlach said.
“Small craft brewers are growing, creating jobs and contributing in small and big ways to the recovery of the American economy,” said Charlie Papazian, president, Brewers Association. “The bipartisan effort by Congressmen Gerlach and Neal is a strong message most Americans will raise a toast to and is indicative of the grassroots community spirit with which Americans are embracing to work towards economic recovery and sustain it for the future.”
Papazian added, “The 1,700+ small American breweries account for about five percent of all the beer enjoyed in the United States and 50 percent of brewery jobs. The bipartisan support the Small BREW Act engenders will help assure a positive impact on agricultural, manufacturing, hospitality and distribution jobs for the future.”
4 Apr. 2011