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4-2017

Global hop market

A 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 Russia

Germany 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.

India. Makers Want Beer to be Delinked from Hard Liquors for Taxes

Indian beer makers have demanded that all the state governments should delink the beverage from hard alcoholic liquors as far as levying taxes is concerned.

All India Brewers Association Director-General Shobhan Roy said the current policies pertaining to alco-bev sector in India are driving people towards consumption of hard spirits.

"There is a strong need to delink beer from hard spirits and rationalisation of taxes as per actual alcohol content to bring a slow but definite change in consumption pattern. Just like other parts of the world, the emphasis will then shift to not only controlling consumption but to reducing intake of more hard spirits," Roy said in a statement.

Additionally, the reach of low alcoholic beverages needs to improve keeping social objectives in mind and it is imperative to create better retail environment with focus on having beer only at outlets/restaurants and rationalise the number of outlets to commensurate with population, he said.

"It is time beer should be delinked from hard liquor in terms of perception, taxation, availability and distribution," he said.

The consumption of alcoholic beverages in the country has been historically skewed towards hard liquor (spirits and country liquor) as against low alcoholic beverages such as beer and wine, the statement said.

Claiming that beer has much lower content of alcohol compared to IMFL and country liquor, the AIBA said its "moderate consumption" as against other forms of alcohol products may lead to reduction in the level of intoxication and hence positive societal impact.

"Current policies of individual state governments are indiscriminately aimed at raising revenues from the alcoholic beverage sector without differentiating the categories of low alcoholic beverages. These policies overlook social needs and objectives and are thus driving people to consume hard liquor," it said.

In Telangana, 515 lakh cases of IMFL are sold annually as against 500 lakh cases of beer. In terms of absolute alcohol, 1,983 lakh litres of IMFL and just 234 lakh litres of beer is being consumed annually, AIBA said.

The AIBA further said there is only one outlet for 18,000 people compared to 300 in China.

Most of the countries in the world, except India, recognise that there are essential differences between high alcohol content drinks and lower alcohol content drinks like beer and therefore, spirits are taxed at a significantly higher rate.

The world over, beer accounts for 80 per cent of the market where as in India it is a meagre 35 per cent and on absolute alcohol content basis it is less than 18 per cent, it said.

23 Feb. 2016

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