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.
Japan. Asahi has its eyes on Grolsch, Peroni
Asahi's headquarters in Tokyo is shown in this photo taken in November 2015.
But Asahi's bid for the two European brands could fizzle; investment funds and major European brewers are also believed to be considering whether to throw their hats into the ring.
Asahi's bid for Grolsch and Peroni comes about two months after Anheuser-Busch InBev, the world's top beer producer, based in Belgium, announced its acquisition of second-ranked SABMiller.
Anheuser-Busch InBev and SABMiller have a combined global market share of over 30%.
After the mega merger was announced, Naoki Izumiya, Asahi's president and chief executive, said, "We are now in a phase where we have to make a sortie aggressively before being swallowed up" by bigger rivals.
Asahi, which is best known for its signature Asahi Super Dry, is Japan's biggest beer producer. Globally, it is No. 10, with a market share of 1.2%.
Anheuser-Busch InBev and SABMiller are under pressure to divest some of their assets so they can get approval for their merger from competition watchdogs in Europe and elsewhere. As a result, they are seeking bidders for the Grolsch and Peroni brands.
Asahi sees the merger between the world's two biggest players as a golden opportunity to expand its global operations.
In the five years since President and CEO Izumiya took office, Asahi has invested 350 billion yen in acquiring other companies. It made a 98 billion-yen purchase of New Zealand's Independent Liquor in 2011.
But Asahi still lags domestic rivals such as Kirin Holdings and Suntory Holdings in terms of overseas operations. Foreign sales account for just over 10% of Asahi's overall sales, compared with well over 30% for Kirin and Suntory.
In addition, Asahi has yet to establish a strong presence in the two huge markets of China and the U.S.; its overseas operations are concentrated in Oceania and Southeast Asia.
11 Jan. 2016