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.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
USA. Early harvest results raise concerns about malt barley supplies
Reports on the early barley harvest, indicating poor quality and low yields, have done little to ease those worries, according to Randy Brag from Valley Grain Services in Casselton, N.D.
"We've seen cases here in Cass County where yields have been as low as 10 bushels an acre to as high as 100 bushels," he said. "And then there are cases where the crop has been dug up because it wasn't worth combining. In the world of barley, this year?s crop is known as a 'mixed bag'."
He also noted that there are considerable disease problems in the eastern North Dakota and Minnesota barley crops, with vomitoxin levels as high as nine in North Dakota and an even higher 11 in areas east of the Red River.
Normally, maltsters reject any barley has that has a vomitoxin level higher than 1 to 1.5.
Brag also has a facility in Beulah, and noted that barley quality conditions in that area of the state are better than in the eastern regions. The vomitoxin levels are definitely lower and the yield figures he has heard range from 50 to 75 bushels per acre. But, the total acres in that area were down due to prevented plant.
"Due to the short supply problems, I think the maltsters are going to have to sit back and see how this all develops before making any decisions on what they are going to do as far as what they are going to accept on contract and what they are going to let go," he said.
Brag claimed the hot period in July was really hard on the barley and it seemed to impact most fields, regardless as to when it was planted. The surplus moisture conditions also have resulted in lower test weights with 41 to 46 pounds the average range.
As a result of the short barley crop this year, the mountain of barley stocks that has been holding prices down for the past two years has eroded away.
Brag predicts the maltsters will be offering some very attractive contracts to win back some of the acres to barley, which have slipped away to other crops over the past few years.
And those contracts should be coming out soon as early as the dates for Big Iron, in fact.
"We are looking at an incredibly small crop for North Dakota, which has always been number one in the nation in barley production," he said. "As a result the maltsters are going to be real aggressive in getting some acres contracted; they have to. I haven't seen anything like this in my lifetime.
"Maybe the downward movement of wheat, beans and corn in this market will encourage some people to plant barley."
On a cash basis, malting barley continues to show strength even though the other grains have trended lower with the recent economic news.
Brag has heard in some cases where local elevators are offering as much as
$7 a bushel for malting barley, which accounts for around a 50-cent bump in the last two weeks. Feed barley, has also shown a slight strengthening over the period with prices about a dime higher at $4.85 to $5.
Brag expects to see good prices for some time to come, both for feed and malting barley, citing good U.S. demand as a reason for prices to remain high.
"The maltsters are going to need barley. That is the message brewing industry wants to get out," he said. "They need barley acres. The question is what price will it take to get some of those acres back into barley production?"
5 Sep. 2011