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.
SABMiller launches first ever cassava lager in Mozambique
Impala is brewed using 70% cassava and is the result of several years of research to overcome the challenges of processing and brewing with cassava, which grows widely across Africa.
Mozambican farmers potentially produce more than enough cassava than is required for domestic consumption, but the surplus has never previously been used to brew beer because of the logistical challenge of collecting the roots from smallholder farmers who are widely dispersed, along with its rapid deterioration immediately after harvesting. Cassava is an excellent source of starch, but starts to degrade almost immediately after it is harvested, which, together with its high water content, makes it unsuitable for transporting over long distances.
SABMiller has partnered with DADTCO (Dutch Agricultural Development and Trading Company), which has pioneered an innovative solution in the form of a mobile processing unit (AMPU) which travels to the cassava growing regions and processes the root in situ, preserving the integrity of the starch.
Mark Bowman, Managing Director of SABMiller Africa, said: "We estimate that the volume of the informal, unregulated alcohol market across Africa could be up to four times that of the formal market. By using locally-sourced raw materials, we are able to create high-quality, affordable products for consumers who would otherwise be drinking informal or illicit alcohol. At the same time, Africa's agricultural potential is enormous, but currently under-exploited. The private sector has a critical role to play - by creating market opportunities for subsistence farmers in our value chains, we are able to increase their productivity allowing them to feed their families and generate an income for the first time."
Peter Bolt, Managing Director of DADTCO said "The rural regions we are targeting are extremely poor and the farmers have previously struggled to sell more than a bag of cassava every two weeks. By creating a sustainable, vibrant market for their crops, buying from them direct and helping them to improve their yields, there is no doubt that this project will have a significant impact on their lives and the local economy."
Approximately 40,000 tonnes of raw cassava will be used annually in the production of Impala, creating new employment for over 1,500 smallholder farmers and their families. DADTCO will manage the cassava production value chain and the agricultural extension services will be provided by IFDC, a public international organization assisting farmers across Africa. IFDC is helping these subsistence farmers by transferring technology and knowledge of agricultural best practices so they can increase the productivity of their land, growing more cassava and increasing their incomes. The public-private partnership between DADTCO and IFDC is supported by funding from the Directorate-General for International Cooperation (DGIS) of the Netherlands.
In recognition of the potential long-term contribution that the brand will make to agricultural and economic development the country, the government of Mozambique has agreed a reduced excise rate for Impala. This, along with the reduced input costs provided by the use of locally grown cassava allows Impala to be sold at a price point equal to 70% of mainstream lager.
SABMiller is committed to promoting responsible drinking and seeks to work with governments, NGOs and other stakeholders to address the harm caused by the minority of people who drink to excess, drink while under age, or drink and drive. By creating an affordable, regulated, high-quality beer the company is providing consumers with an alternative to illicit alcohol, and is better placed to deliver the responsible consumption messages and accurate product information which are a part of its commitment to responsible marketing.
The project is part of ‘Farming Better Futures' which encompasses SABMiller's agricultural programmes across Africa and involves countries such as Uganda, Tanzania and Zambia and includes sorghum and barley farmers.
Notes to editors
?SABMiller first invested in Cervejas de Mo?ambique (CDM) in 1995.
?Impala will be brewed at its Nampula brewery in the north of the country
?Average per capita consumption of beer in Mozambique is around 8 litres per year, compared to 60 litres in neighbouring South Africa.
?Agriculture makes up 31.5% of Mozambique's GDP (2009, World Bank Data)
2 Nov. 2011