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.
China. CRB Spent 330 Million on the Factory in Loudi Settled in Hunan
On June 10th 2011, China Resources Snow Breweries (China) Co., LTD (CRB) officially announced that CRB started building the production base in Loudi. The new factory will be located at Loudi economic developing zone Taihe Industrial Park, covering an area of 300 acres, with a total investment of 330 million yuan. The production plan is to achieve 200-thousand-kiloliters annually.
The secretary municipal committee of Loudi Wu Lin, People's Congress Mayor Shuofu Zhang, China Resources Snow Breweries (China) Co., LTD CTO Wenfeng Cheng, China Resources Snow Breweries (Loudi) Co., LTD Manager Xiangyang Yu and other leaders attended the acquisition ceremony; in addition, Mayor Shuofu Zhang gave a very important speech.
It is important to note that CRB has already owned a factory in Yueyang, Hunan Province, since to 2007. The fact that they settled in Hunan indicates consolidation and a growth in the Hunan market.
According to China Resources Snow Breweries (China) Co., LTD CTO Wenfeng Cheng, the market in Hunan is CRB's most important market in Central China; in addition, it is also the place that carries on their historic mission and supports "Development of the West Regions" in China. Loudi is not only the hinterland in the Hunan province, but also the economic communication hub between the central and western regions; therefore, the establishing of the factory in Loudi is significantly important to the national business strategy of CRB.
CRB already has a solid foundation of marketing in the local area. Since arriving in Loudi in 2005, CRB has benefited from intensive interaction with local consumers, through events like Snow beer festivals, which convince Loudi residents to adopt Snow beer as their local beer brand. These things laid the groundwork for the establishment of the factory in Loudi when the conditions were ripe.
Local industry professionals think that the CRB Loudi factory will be one of the biggest breweries in the Hunan Province, with the most advanced equipment. According to CRB, all the production processed are controlled by computer, and key processes like, saccharification, smashing, fermentation, yeast propagation, filtering, and packaging are all automated processes.
According to publicly accessible information, Snow beer has been leading the industry since 2005; however, in 2010, CRB continued enlarging the sale volume gap between itself and its competitors. Last year, CRB sold over 9.28-million-kiloliters of beer. With 11% growth, and Snow's single-brand sales increased by 16% to 8.413-million-kiloliters, the company consolidated its position as the leading beer brand in the world.
Without question the leader of the Chinese beer industry, CRB does will not lose its momentum in 2011; instead, it plans to keep running faster and faster. This delivers a positive signal: the Chinese beer industry will continue growing at a high speed.
About CRB (China) Co., Ltd.
CRB (China) Co., Ltd., established in 1994, is a professional production and management beer company of the country. It is headquartered in Beijing, China. Its shareholders are China Resources Enterprise, Limited and the world's second largest beer group, SABMiller. CRB is currently operating more than 70 breweries in China, including Snow brand, and holds more than 30 regional brands in the Chinese beer market and has 19.8% of the market share. In 2010, CRB sold over 9.28-million-kiloliters of beer. With 11% growth, the company's total production and sales have been exceeded those of other domestic beer companies for five consecutive years. In 2010, Snow's single-brand sales increased by 16% and reached 8.413-million-kiloliters, consolidating its position as the leading beer brand in the world.
About Snow Beer
In 1964, in a product rating competition, where all the top Chinese beer companies had gathered, a new product took the prize. It was all because of its rich, white, snow-like foam, and long-lasting taste, like a flower, giving it its name: "Snow Beer."
In 2002, CRB (China) Co., Ltd. made Snow Beer into a national beer brand. Snow Beer has a fresh, light taste and is a positive, aggressive, challenging and innovative brand with high popularity among consumers nationwide. It has become a favorite beer among youth. The State Administration for Industry and Trademark Office declared "Snow" brand as "China's Famous Brand" in September 2007.
In 2005, Snow Beer sold 1.58-million-kiloliters of beer and became number one in sales of single-product beer brands. In 2006, Snow became the fastest growing and most valuable beer brand; its brand value reached 11.185 billion yuan. Following 2006, after becoming number one in single-product sales, it reached a record high in 2007: 5.1 million-kiloliters sold; once again, it achieved the best single-product sales in the Chinese beer industry. In 2007, Snow's brand value reached 13.658 billion yuan. Single-brand Snow sales increased by 19.1% in 2008; sales reached 6.1-million-kiloliters, and it was given the "number one single-brand sales" title four times, becoming the world's number-one selling beer brand, with a brand value of 15.3 billion. Snow's brand value increased to 37.726 billion yuan in 2009.
About China Resources Enterprise, Limited
China Resources Enterprise, Limited is listed on the Hong Kong Stock Exchange, as one of Hong Kong's Hang Seng Index constituent stocks. The company focuses on consumer products business, with operations in Mainland China and Hong Kong, and is principally engaged in retail, beverage, food processing and distribution.
About SABMiller plc
SABMiller is one of the world's largest beer companies; it is a London-based company that is listed on the London and Johannesburg stock market exchange. SABMiller has a large-scale production and sale of beer and other beverages in 75 countries on six continents. It owns more than one hundred breweries and two hundred brands of beer; its annual beer sales are about 21.0393 million tons. SABMiller is highly recognized for its production management in the international market and is considered to be a well-operated company in emerging markets. In many countries the company has entered, SABMiller brand portfolio and market shares are all in the market leadership position.
This SABMiller subsidiary news release has been translated from its local market language to English language for publication on www.sabmiller.com. We have attempted to provide an accurate translation of the original material but due to the difficulties of translation slight differences may exist.
15 Jun. 2011