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.
Vietnam. Brewer Sabeco not selling majority stake to foreign players
After Sabeco’s IPO eight years ago, the state still owns the controlling rate of 89.59 per cent in the company and is looking to unload over 51 per cent of Sabeco’s equity. Dutch brewing firm Heineken is currently the only foreign large shareholder at the Vietnamese beer major, has a five per cent stake.
However, Sabeco does not want to sell the next batches of shares to foreign companies if the Ministry of Industry and Trade divests, the local newswire ttvn.vn reported discussion during a recent ministry meeting.
DEALSTREETASIA had earlier reported that the share sale for the brewer had been planned to be executed either in two tranches, or in a single tranche worth some $1 billion, to reduce the state ownership to 36 per cent. The government values Sabeco at roughly $2 billion through the divestment.
Vo Thanh Ha, Sabeco chairman, reportedly proposed the government to space the sales by at least a year so that production could stabilise, considering the transfer of such large amounts of shares affecting its performance.
Ha also asserted that the role of privatisation had been pale in Sabeco, where IPO was not for the purpose of fundraising, while the company has always had in place latest production technologies, the Bao Dau tu cited him. In terms of management capacity, the progress Sabeco had made was not resulted from privatisation, Ha reportedly added.
As the local largest beer producer wants to retain its own brand, government officials are concerned that it is the major hurdle to the privatisation process of this state-owned business. While the foreign investors interested in Sabeco are all players in the same industry (namely Thailand’s Singha Corp and Thai Beverage Group, Asahi Breweries from Japan, SAB Miller from the US and Heineken, which is already a Sabeco stakeholder), domestic bidders are experts in the real estate and financial sectors.
“We should be cautious when working with large firms. Cooperation in the same industry can be beneficial, but the threat is that we might soon lose our brand. By all means, annexationism always exists in the business method of large companies,” Sabeco’s former chairman Phan Dang Tuat told the company’s shareholders at a mid-year meeting.
The beer maker eyes strategic investors who do not directly compete with it.
As the largest beer consumption country in Southeast Asia, this market in Vietnam is estimated at $3 billion with an annual growth of 15 per cent. Several international beer firms have been present in the country to enjoy fruitful development and threaten the position of domestic players like Sabeco and the Hanoi Beer Alcohol and Beverage Corporation, or Habeco.
Vietnam Brewery Limited, for example, earned nearly VND6.5 trillion ($288.5 million) profit in 2014, far surpassing VND3.9 trillion of Sabeco, although sales of the provider of Heineken and Tiger brands for the year accounted for only 70 per cent of the Vietnamese brewer, which had the leading market share of 46 per cent, according to Euromonitor International.
Consolidation has also taken place in the country, most lately seeing Japanese Sapporo’s wider reach by fully acquiring its Vietnam-based facility from the Vietnam National Tobacco Corporation.
Carlsberg is also an active brand in this area, having forged joint ventures with Viet Ha Beer, Ha Long Brewery and Beverage and Habeco; and taken over Huda Beer, a brand focused on the central region of Vietnam.
Meanwhile, later comers include AB InBev, which is involved in a formal merger with SAB Miller to help it exploit potentials in markets outside the US. AB InBev is running a brewery in Binh Duong province. In addition, Taiwan Tobacco & Liquor Corp targets to open a factory in Vietnam through partnership with Sapporo Vietnam Co Ltd.
25 Dec. 2015