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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.

SABMiller announces further investment in its Southern Sudan operations

SABMiller plc [SAB:LSE/SAB:JNB] subsidiary company Southern Sudan Beverages Ltd (SSBL) announces that it is investing an additional US$15 million in its operations in South Sudan to increase production capacity and build on the strong performance of its local brand portfolio.

SSBL's state of the art brewery in Juba is currently at full capacity. By November 2011, today's investment will have increased brewing capacity to a total of 500,000 hectolitres.

The investment comes in response to very positive consumer acceptance of SSBL's brands in its first two years of operation and will enable the company to service the entire South Sudanese market with a balanced and affordable portfolio of brands. The popularity of the newly-launched White Bull brand and the locally brewed and bottled Nile Special brand has driven the increase in production capability. However, improved capacity will also give the company the flexibility to introduce new brands to the market.

Ian Alsworth-Elvey, Managing Director of SSBL, said "Our investment in Southern Sudan continues to bear fruit due to the country's improving economic outlook and a continued positive consumer response to our brand portfolio. Increasing our brewing capacity takes the business to the next level, supporting growth in our key mainstream segments and helping us to build market share.

"In line with our global priorities, we are continuing to build the business through the value chain, working with local farmers to improve techniques and increase yield and supporting employment in the local community. Today's announcement reinforces our commitment to this exciting and growing market."

SSBL commissioned its brewery in South Sudan in 2009 and invested US$37m to build the facility in Juba. To date, its operations in the region have created employment for 200 Sudanese. Its pioneering land lease agreement ensures that the local community receives royalties from the development and benefits from the business' continued success. SSBL, through SABMiller, is one of the largest private sector contributors to the South Sudanese economy, paying excise tax at both national and state level.

In 2010 SABMiller won nearly US$1 million funding from the Africa Enterprise Challenge Fund (AECF) to introduce an innovative local sourcing model for cassava, which will provide the ingredients from which beer will be brewed. SABMiller is partnering with leading NGO, FARM-Africa, to implement the initiative, which will bring direct and significant long-term market opportunities for around 2,000 smallholder farmers with dependants and other employment effects ensuring approximately 15,600 people could benefit in three years.

The Juba brewery will continue to provide increased carbonated soft drink (CSD) capacity of 320,000 hectolitres (from initial capacity of 60,000hl), in response to the initial popularity of SSBL's Club Minerals Sparkling Soft Drinks range and Source Pure Drinking Water.

Ends

Notes to editors

SABMiller plc is one of the world's largest brewers with brewing interests and distribution agreements across six continents. The group's wide portfolio of brands includes premium international beers such as Pilsner Urquell, Peroni Nastro Azzurro, Miller Genuine Draft and Grolsch, as well as leading local brands such as Aguila, Castle, Miller Lite, Snow and Tyskie. SABMiller is also one of the world's largest bottlers of Coca-Cola products.

In the year ended 31 March 2010, the group reported US$3,803 million adjusted pre-tax profit and group revenue of US$26,350 million. SABMiller plc is listed on the London and Johannesburg stock exchanges.

High resolution images and broadcast footage are available for the media to view and download free of charge from the News and media centre on www.sabmiller.com

12 Apr. 2011

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