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.
Australia. CCA to stay in beer market
International beverage giant SABMiller made a $9.51 billion cash takeover offer for brewer Foster's in June.
Foster's rejected the offer, saying it undervalued the company.
CCA has a brewing joint venture with SABMiller, called Pacific Beverages, which competes with Foster's.
Pacific Beverages makes the Bluetongue brand and distributes products such as Peroni Nastro Azzurro, Grolsch and Pilsner in Australia and New Zealand.
SABMiller did not wish to make a joint bid with CCA, and CCA did not wish to acquire shares in Foster's.
Consequently, it was agreed that should SABMiller succeed in taking over Foster's, SABMiller would buy out CCA's half-stake in Pacific Beverages for between $305 million and $380 million and CCA would have the right to acquire some of Foster's businesses.
CCA managing director Terry Davis on Tuesday said the outcome for CCA should SABMiller succeed in its bid for Foster's would be "very, very positive".
"While it's part of the Foster's deal that we will not play in the beer space for two years in Australia, we certainly intend to re-enter the beer market," Mr Davis said.
"And in the interim we would have a significantly strengthened spirits portfolio.
"I can confirm that whatever the outcome of the SABMiller bid that CCA will continue to play a very meaningful role in Australian (alcoholic) beverages in Australia and New Zealand."
r Davis said that the sale of the stake in Pacific Beverages would render a profit of $200 million to $300 million on book value, and interest savings alone would deliver an immediate lift of two to three per cent in CCA's earnings per share.
CCA would also get the opportunity to acquire all of the Foster's spirits, ready-to-drink mixed spirits and non-alcoholic brands at prices that would immediately add to CCA's earnings per share.
"More importantly, by selling our 50 per cent share of the joint venture, our capability in alcoholic beverages does not disappear. Our sales force remains the same," Mr Davis said.
"In the four years that we have been in this space (beer), our team has demonstrated the enormous value that our large-scale sales, distribution and servicing capability can do to good brands."
10 Aug. 2011