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.
GLOBAL: Carlsberg will hold edge over rivals in 2013 – analyst
The Danish brewer's stock price has suffered from its exposure in its key market of Russia, Bernstein analyst, Trevor Stirling, said in a note yesterday (8 January). But though 2013 is “unlikely to be a bumper year for Carlsberg”, a stabilised Russian market and the brewer's reversal of a two-year market share lose there mean its stock will outperform, Stirling said.
Its rival, Heineken, should also see a jump in share price as Mexico drives fresh growth and its recent Asia Pacific Breweries deal adds to earning, he added.
Carlsberg and Heineken will both be boosted this year due to lower barley and aluminium costs and better cost savings, Stirling suggested. “We expect that this improved earnings outlook will also lead to a further modest re-rating, resulting in the end of the double discount that we believe afflicts both stocks,” the note said.
Meanwhile, Anheuser-Busch InBev's share growth is expected to be held back by its exposure to the US, Stirling said. But he added: "US beer volumes are improving as unemployment in key demographics is slowly but steadily declining and the rate of consumer deleverage is slowing."
For SABMiller, currency fluctuations in its core emerging markets will damage profits, Stirling predicted.
Meanwhile, the analyst branded 2012 “a year of two halves” for Europe's beverage shares, with H1 out-performance giving way to a 2% under-performance in H2.
“We expect this (H1) pattern to continue into 2013,” Stirling said, adding that investors are likely to take funds from beverages to invest in higher-risk shares.
The note added: “We are likely looking at several more months of subdued broadly-neutral relative performance.”
8 Jan. 2013