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.
Kirin Forecast Misses Estimates on Australia, Japan Declines
Net income may reach 48 billion yen ($618 million) in the 12 months ending Dec. 31, the Tokyo-based company said in a statement yesterday. That compares with the 62.5 billion yen average estimate of 16 analysts based on data compiled by Bloomberg.
Earnings from its Lion unit in Australia will miss budget as discounting by the nation’s biggest retailers stymies its ability to raise prices, higher ingredient costs curb profitability and stalling consumer demand cuts sales. Declines in the Japanese drinks market will result in revenue missing target and limiting the benefit of overseas acquisitions such as Brazil’s Schincariol Participacoes e Representacoes.
“We want to take a medium to long-term view for Lion,” President Senji Miyake told reporters in Tokyo yesterday.
Kirin expects 2012 earnings from Lion of A$96 million ($103 million), lower than the A$350 million target set in 2010, it said in a presentation on its website. Kirin owns Australia’s second-largest brewer and largest milk processor.
Lion’s management will focus on more profitable products, such as cheese and flavored drinks, to reduce the impact of plain milk discounting by retailers.
Kirin and rivals Sapporo Holdings Ltd. (2501) and Asahi Group Holdings Ltd. have expanded overseas to offset a slump in demand at home. Industrywide beer sales in Japan fell 3.7 percent to 442 million cases last year, the lowest level since records began in 1992.
Schincariol, San Miguel
Among other acquisitions last year, Kirin agreed to buy out shareholders in Schincariol Participacoes e Representacoes in November 2011. The deal at that time valued the Brazilian company at about $3.6 billion excluding debt, when combined with the initial purchase of a 50.45 percent stake.
The brewer increased its stake in Manila-based San Miguel Brewery Inc. (SMB) to 48 percent in 2009, bought a 14.7 percent of Singapore’s Fraser and Neave Ltd. (FNN) in 2010 and purchased a majority stake in Vietnam’s Interfood Shareholding Co. for an undisclosed sum in March 2011.
Kirin’s 2011 annual profit dropped 35 percent as the value of its Sydney-based Lion unit and investments declined. Net income fell to 7.4 billion yen in 2011 from 11.4 billion yen the previous year, the Tokyo-based company said yesterday.
Kirin’s rival Asahi Group Holdings Ltd., which spent at least $1.8 billion on acquisitions in 2011, yesterday forecast 2012 profit will rise 18 percent, in line with analyst estimates.
Asahi, Japan’s largest brewer by volume, said net income may climb to 65 billion yen ($837 million) in the 12 months ending Dec. 31 from 55.1 billion yen in 2011, according to a statement yesterday. The forecast compares with the 64.9 billion yen average of 15 analyst estimates compiled by Bloomberg.
Kirin, Asahi and Sapporo were forced to temporarily shut factories after the March 11 earthquake in northern Japan. Beer shipments by the nation’s five biggest brewers plunged more than 8 percent in the months of March, May and June from a year earlier.
Sapporo forecast net income of 6.3 billion yen in 2012 and 7.4 billion yen in 2013, compared with the 7.95 billion yen mean estimate of five analysts for 2012 and 8.8 billion yen estimate for 2013.
The company posted 2011 net income of 3.2 billion yen, according to statement to Tokyo Stock Exchange.
Kirin’s shares rose 1.9 percent to 967 yen at the close in Tokyo yesterday before the earnings were released. Asahi climbed 0.8 percent to 1,731 yen, while Sapporo gained 0.7 percent to 294 yen.
14 Feb. 2012