The beer market dynamics in Russia is approaching zero, yet major brewers are divided into those who developed considerably in 2017 and those who considerably reduced their volumes. For instance, company Efes has managed to substantially extend their sales due to restrained pricing policy and activity in the modern trade. Heineken has also demonstrated an excellent performance promoted by significant increase of advertisement budgets launching a non-alcohol sort of the title brand and unusual activity in the economy market segment. Carlsberg and AB InBev have been focusing on margins and lost a market share of their inexpensive brands. Serious dependence on PET package and mass enthusiasm about Zhigulevskoe have negatively impacted the most of big regional brewers, that have been for the first time pressed by the leaders in the key sales channels, especially in Volga and Central regions. In the small business there has been a noticeable slowdown in appearing of new restaurant breweries, yet the number of craft breweries has been growing rapidly. In 2018, the beer market is likely to grow a little, while the share of AB InBev Efes may decrease due to the integration. ...
“Catalogue of Russian Beer Producers 2018” includes 1070 businesses ranging from large subsidiaries of international companies to rather small restaurant and craft microbreweries.The catalogue includes 32 large breweries, 75 regional breweries, 693 industrial mini- and microbreweries as well as 270 restaurant breweries. ...
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.
Molson Reaching For Foster’s
Bank of America Corp and Deutsche Bank are reported to be the main banks helping Molson; Molson and Modelo are working out an ideal financial offer to take Foster’s into its ambit. However, the details of the joint bid were not disclosed.
Many potential buyers have been planning to acquire Foster’s since it announced plans last year to spin-off its struggling wine operations, which was seen as a deterrent for its growth.
Companies like Japan’s Asahi, Coca-Cola Amatil and SABMiller were the potential buyers, and analysts assume the strong Australian dollar as a possible factor that weakened the allure for Foster’s. However, in February this year, Japan’s Asahi Breweries stated that it had no interest in buying any part of Foster’s.
However, a successful takeover of Forster’s would be one of the biggest deals in the beverage sector.
Foster’s is one of the top brewers in Australia with renowned brands like VB and Cascade and has a 50% market share of Australia. Therefore, the deal if successful will not only be a strategic fit to the companies in terms of portfolio addition but will also give them the exposure to the high potential Australian market.
However, analysts feel that the Molson and Modelo team up is not very promising for the takeover as the partnership would cost Molson highly since the Mexican brewer is half-owned by Anheuser Busch InBev (NYSE:BUD), the world’s largest brewer.
Analysts apprehend that Anheuser-Busch InBev may block any such deal that enhances the value of Modelo and make the outright ownership of Modelo difficult for the former in the near future.
Analysts are of the opinion that SABMiller, Molson Coors’ majority partner in the Miller Coors joint venture in the U.S, is more likely to be a part of the team in swallowing the Foster’s Group.
We remain encouraged by the restructuring initiatives taken by Molson to reduce overhead costs and boost profitability. The initiatives include closure of underperforming breweries and efforts to attain efficiency in finance, administration and human resource activities. However, seasonal nature of the business of Molson Coors and increased competition from Anheuser-Busch InBevare concerns.
7 Jun. 2011