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.
Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
Business takes a critical look at climat change challenge
SAB believes that while COP17 is an important dialogue, policy makers should focus on adaption to climate change. "In many parts of the world, the impact of climate change is already visible. Responsible and proactive companies must therefore be thinking about how to adapt to these climate impacts. In South Africa, water scarcity is one of the most critical impacts," says Andre Fourie, SAB Head Sustainable Development.
Water as an area of climate adaption in the Southern African region and key actions required to develop an integrated and shared approach to water resource management, will headline a session titled: Business response to climate variability in Southern Africa: focus on adaption and water stewardship by leading corporations; co-hosted by SAB, WWF and Nedbank, on Thursday, 1 December 2011.
SAB will contribute its experience and work, in particular around water management, to the session, and hopes to gain further from the key learnings of other corporations prioritising the mitigation of and adaption to climate change.
SAB has opted for a holistic approach to climate change, which recognises both mitigation and adaption interventions. "We understand that while it is important to eliminate and reduce the causes of climate change, it is also equally important to reduce vulnerability and increase resilience to the inevitable impacts through adaption, in particular the threat of water scarcity," says Andre Fourie, SAB Head Sustainable Development.
SAB sees sustainability as fundamental to business success and two of the organisation's ten sustainable development priorities relating directly to climate change and adaption. These are: Reducing energy and carbon footprint and Making more beer using less water. "Aside from its broader economic and societal impacts, climate change could directly affect many aspects of SAB's business in the coming years, including the availability of water and crops - essential inputs in the brewing process," says Fourie.
The company's climate change strategy goes beyond energy efficiency and switching to renewable energy sources. It focuses on how SAB can help to reduce greenhouse gas emissions across the entire value chain in relation to packaging, manufacturing, transport and refrigeration.
In terms of reducing energy and carbon footprints, SAB has made a commitment to:
- Minimise the impact of energy constraints on operations, customers and consumers through practical, proactive and strategic interventions
- Meeting Eskom and government's reduction targets within the set timeframes and where possible, exceeding the minimum required savings
- Educating and empowering people to become energy-conserving champions
- Adopting energy saving measures and reporting savings achieved transparently and timeously
- Ensuring that energy saving initiatives are in line with existing sustainable development objectives
SAB recently announced that it had reduced its annual electricity consumption throughout its breweries by a total of 17%, well above the initial targeted electricity reduction of 10%.
SAB's reduced consumption equates to just over 1%, or approximately 115 million kilowatt hours, of Eskom's total required savings of 9 Terawatt hours. The company is now working towards a global SABMiller target to build onto its electricity consumption achievement and is aiming to reduce carbon emissions from onsite energy use by 50% per hectolitre of beer by 2020.
SAB also proactively engages with relevant authorities on a regional and national basis to reduce the impact of electricity consumption on the business.
Because climate change will have an impact on the availability of water, SAB consistently reengineers the business to be water efficient as a climate adaption effort.
The company is one of the first to undertake a comprehensive water footprinting exercise, which revealed that more than 90% of the water footprint of a bottle of beer is found in the agricultural supply chain. SAB therefore works with farmers who supply the company with barley and hops on initiatives to help reduce water usage. SAB is working with the WWF and GIZ (the German technical company) in the Water Futures Partnership, focusing on the George area which is both under water pressure and the only part of the country where hops is grown commercially.
SAB's water strategy is based on 5 R's - pRotect, Reduce, Reuse, Recycle and in the value chain. The strategy focuses on four key areas:
In the brewery - using less water to make more beer and manage effluent standards
In the supply chain - working with suppliers and farmers to identify water risks and options to reduce water use across the supply chain
In communities - identifying community projects that will help provide safe and sustainable drinking water to communities
Water governance - keeping water on SAB's strategic and risk agenda, mobilizing employees to save water, engaging with government on policy issues and delivering on the Water Futures Partnership
Good progress has already been made with SAB having improved its water efficiency by 8% over the past two years to an average of 4.1 litres of water per litre of beer produced. Work is being done to reduce this further by approximately 13% to 3.6 by 2015.
Long term water assessments of all its breweries have been undertaken and SAB has a comprehensive understanding of the risks it faces over the next ten years.
29 Nov. 2011