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.
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.
Recipe for success whets the appetite for more
Positive trend of event bookings, slightly ahead of plan in the first half of 2015.
Outlook: “Hot autumn” in the making.
NürnbergMesse Group has announced impressive results for 2014, with the most exhibition space in the company’s history, the proportion of international exhibitors and trade visitors at new record levels, and international trade fairs growing at a more dynamic pace than the industry average. The financial results are equally impressive: revenue of EUR 229 million, profit of EUR 8.2 million – all without the benefit of public subsidies. For Dr. Roland Fleck and Peter Ottmann, the company’s success can be attributed to numerous factors: “Our events are growing at a splendid pace, and we have continued to grow organically in 2015 as well. We are slightly ahead of plan and therefore well on course to attain our full-year goals. In addition, we are currently stepping up our international presence and developing highly promising formats in the target markets of our customers.” With regard to the next stage of the company’s development, both CEOs expect a “hot autumn.”
In terms of numbers alone, NürnbergMesse Group’s performance in 2014 can be described as follows: 29,171 exhibitors booked 994,000 m² of exhibition space for 151 events attracting 1.32 million visitors. In terms of superlatives, it can be described as follows: NürnbergMesse booked the most exhibition space in its history, and posted new records for the proportion of international exhibitors and trade visitors. Within NürnbergMesse Group, NürnbergMesse GmbH continued its positive development, generating revenue of EUR 192 million and an EBITDA of EUR 37.3 million in 2014. Dr. Roland Fleck: “Financially, the company is in great health and performing extremely well in the market. That makes us one of the very few trade fair companies in Germany that regularly earn profits without the need for subsidies from the shareholders. Another remarkable accomplishment is the fact that we have reduced the GmbH’s liabilities by more than EUR 26 million since completing the investments in Hall 3A, which we financed from our own funds.”
Positive trend of event bookings in 2015
Despite the labour strikes affecting rail and air traffic, NürnbergMesse’s trade fairs performed considerably better than the industry average in the first half of 2015. In 2014, NürnbergMesse already generated a 3 percent increase in exhibitors, a 7 percent increase in trade visitors, and a 7 percent increase in exhibition space, all considerably higher increases than the average for the German trade fair industry. Peter Ottmann clearly stated why this positive trend is being repeated in 2015: “Whether BIOFACH, IWA OutdoorClassics, Enforce Tac, embedded world, or FeuerTRUTZ – our events are growing organically because they are meeting with extremely high demand both nationally and internationally. This healthy mix is the best defence against economic uncertainties!”
Big push forward with internationalisation
In terms of momentum, the positive results of the domestic exhibition centre are actually surpassed by NürnbergMesse’s international growth. In Mumbai, the Indian Chemicals Care Convention opened its doors for the first time, concurrently with Home and Personal Care Ingredients, in March 2015. In Austria, a separate NürnbergMesse Austria was recently launched under the leadership of Inge Tremmel. And Beviale Moscow begins in October 2015. Preparations are currently being made to step up activities in Brazil. For example, POWTECH Brazil will open its doors parallel to FCE Pharma and FCE Cosmetique in May 2016.
“Hot autumn” in the making
For the second half of 2015, moreover, Dr. Roland Fleck and Peter Ottmann are expecting a “hot autumn.” “First, the registration numbers for leased exhibitor space, particularly for FachPack, BrauBeviale, and SPS IPC Drives, suggest that we can again expect substantial growth rates this year. Second, new highly promising formats such as the Street Food Convention will debut in combination with the BrauBeviale or the Insights-X trade fair of our partner Spielwarenmesse eG. And third, we are currently working on the next important step in our company’s development. We expect to announce more details about this step after the upcoming Supervisory Board meeting.” The “NürnbergMesse” recipe for success is whetting the appetite for more!
About the NürnbergMesse Group
NürnbergMesse is one of the 15 largest exhibition companies in the world. The portfolio covers some 120 national and international exhibitions and congresses and approx. 40 sponsored pavilions at the Nuremberg location and worldwide. Every year, around 30,000 exhibitors (international share: 41%) and up to 1.4 million visitors (international share of trade visitors: 24%) participate in the own, partner and guest events of the NürnbergMesse Group, which is present with subsidiaries in China, North America, Brazil, Italy and India. The group also has a network of about 50 representatives operating in over 100 countries.
Legal notice: The data in the 2014 annual financial report is subject to the resolution within the Supervisory Board and approval by the General Assembly of NürnbergMesse GmbH.
21 Jul. 2015