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.
India. Beer Will Be On Tap At Your Local Burger Joints
The need to continually innovate in menu offerings has lead to QSRs to introduce beer and wine as part of their menu to encourage their customer base to spend money at their outlets. Wendy’s and Carl’s Jr. have entered the beer and wine market segment in India and have partnered with major beer sellers to introduce beer and wine brands at their restaurants.
The King of Beers
Kingfisher, the leading beer seller in India, partnered with Carl’s Jr. last year to sell their premium beer brands at the Saket Outlet. Speaking at the launch, Sana Chopra, executive director of Carl’s Jr. India, said, “We are excited to introduce beer to our customers at Carl’s Jr. The youth today is looking for a differentiated experience while eating out and what can be better than a beer.” The need to differentiate themselves with other QSR’s like McDonald’s which caters to the public with children-centric offerings was the main reason behind this partnership, said Chopra.
Carl’s Jr. was one the first outlets to offer beer on the menu and the success of the launch has encouraged other players to dive into the casual dining segment. Samir Chopra, Group Chairman, Cybiz Corp, the franchise for Carl’s Jr. said, “The rest of the burger players got a jolt when we introduced beer in our first outlet in India. But since we address an age group of 18-40, we took the decision to bring beer in India having tried it in certain markets in the US and Russia.”
Wendy’s Will Remain A Burger Joint
Wendy’s are also in talks with premium beer and wine brands to introduce alcohol in the menu but has made sure to position itself as a burger place which sells beer, instead of the other way around. Speaking about the initiative, Jasper Reid, Director of Sierra Nevada, franchisee of Wendy’s in India, said, “Bringing in wine and beer is a new initiative that we have taken for the Indian market. We are trying to get licences for Indian brands in this segment and keep it as affordable as possible. At the same time, we are not a bar but a burger joint.”
Burger and Beer
Since burgers and beer are closely attached at the hip across many countries in Europe and US, the introduction of beer makes a tremendous impact in the revenue generation for these restaurants. The second largest burger brand in the world, Burger King, has yet to enter this market in India but have experimented with it in the US. Raj Varman, CEO of Burger King India, said, “We are not ruling out entering wine and beer since we have Whopper bars in certain places like Miami in the US.’’
Although there are several advantages in introducing beer and wine in the menu, mainly the increase in revenue, there is a distinct doubt as to how these QSRs position themselves as a brand in the marketplace. Fast Food Restaurants like McDonald’s, Burger King, and Wendy’s have continuously invested in changing their brand image from just another fast food place into more of a casual-dining experience. Since the restaurants also cater to a significant number of teenagers and families, there is some doubt regarding how adding items like beer and wine on the menu could impact their brand image.
19 Jan. 2016