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.
Brazil’s AmBev Shaping Up As Potential Leader
This column on Wednesday mentioned some of the highest-rated stocks from Latin America. Two names appeared in that search.
From Mexico, Fomento Economico Mexicano (FMX), or Fomex, is Latin America's largest nonalcoholic beverage company.
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From Brazil, Companhia de Bebidas das Americas (ABV), or AmBev, is Latin America's biggest brewery. The company also distributes Gatorade in a country that goes wild over sports.
Leader In Latin America
AmBev dominates Brazil's beer market with a 68% share. It also delivers several beer brands to 12 other Latin American markets.
Global beverage giant Anheuser-Busch InBev (BUD) bought a majority stake in AmBev seven years ago. AmBev now distributes Budweiser and Stella Artois in Canada, where it holds a 42% market share. AmBev also is the regional PepsiCo distributor.
Scrutiny of AmBev's chart shows a good — but not perfect — base.
AmBev is now in the eighth week of a cup-shaped base with a potential buy point at 34.78.
So what's wrong with the base? The right side is a bit steep, especially compared with the more evenly shaped left-side decline.
Accumulation and distribution are about evenly matched within the base, which has seen a large amount of volume. The base is V-shaped, which is poor form. It does reflect the market's volatility to some extent, though.
So what's right with AmBev's chart? Its base is a second-stage structure. Third- and fourth-stage bases reflect an older uptrend and are more prone to failure than first- or second-stage bases.
Its price action has been less volatile than the corrections of many other leading stocks.
AmBev posted earnings gains in the past four quarters ranging from 32% to 55%.
Estimates for the current period predict a rise of just 17%. That would be the softest such gain in five quarters.
Sales rose just 18% in the second quarter, the most recent report. That's lower than you'd want to see in a market leader.
But AmBev has accelerated its sales growth for three straight quarters. Taken together, AmBev's sales picture may be seen as a positive.
Finally, AmBev boasts the highest annual pretax margin — 39.2% — in its industry group.
Its 32.8% return on equity is second only to China New Borun (BORN), a Chinese small cap with its own set of problems.
AmBev is in IBD's alcoholic beverages industry group. It ranked 62nd out of 197 groups in Thursday's IBD, but the group has been climbing. It was 94th three weeks ago and 132nd six weeks ago.
29 Aug. 2011