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.
In Singapore, Craft Beer Where You’d Least Expect It
Mr. Goh referred to nearby Sago Lane, which was called “Death Alley” in the first half of the 20th century because of its many funeral parlors and coffin shops, and the grim custom of some Chinese citizens going to these so-called death houses when they were about to die.
The government outlawed such places in 1961, and many of the area’s funerary traders had long vanished by the time much of Sago Lane was leveled to make way for the labyrinthine Chinatown Complex, whose exterior is brightly adorned with incandescent Chinese paper lanterns strung in zigzags above the busy street below.
Home to hundreds of food stalls and sundries shops, the structure is one of Singapore’s older hawker centers, or open-air food courts. The government built more than 100 of them from 1971 to 1986 while authorities, citing waste-management and public-health issues, enticed the island’s tens of thousands of food vendors from the streets to these facilities with multiple stalls and promises of low rent.
Though the move robbed Singapore of the lively street-food culture celebrated in many other parts of Southeast Asia, today the rough-and-tumble hawker centers thrive as community gathering spaces and lively eating houses. Here local chefs serve myriad foods hot, fresh and cheap, from Singaporean specialties like laksa (a rich, spicy, coconut broth-based soup) and chicken rice to Indian, Thai, Indonesian and even Western staples like hot dogs and spaghetti.
It was the affordable Chinatown Complex rent, minimal start-up cost and the chance to pair beers with all these local foods that in 2011 inspired Mr. Goh, 40, to open the Good Beer Company, Singapore’s first hawker stall specializing in craft brews. Offering a choice of some 60 imported bottles, the stall proved so successful that in January 2014 Mr. Goh partnered with a fellow beer merchant, Meng Chao, 47, to set up another stall, Smith Street Taps, right next door.
While Good Beer Company deals in bottled beers, Smith Street Taps began as the first Singapore stall hawking craft on tap. “It was a risk,” said Mr. Chao. “Bottles can sit on shelves, but with draft we have to turn kegs around quickly.”
Thus far that hasn’t been a problem. Now up to 11 taps from its initial seven, Smith Street Taps fast became the de facto center of Singapore’s nascent craft beer scene, going through its 20- to 30-liter kegs within two or three days. Some beers, such as the Bomb! imperial stout from the Oklahoma-based Prairie Artisan Ales, last less than a night. “People come for beers they’ll never, ever get to try, sometimes even if they travel to their source,” Mr. Goh said.
At Smith Street Taps, many local importers introduce overseas breweries to Singapore via tap takeovers, when a range of beers from a single brewery flow from most taps. Siren Craft Brew (Berkshire, Britain), Baird Beer (Numazu, Japan) and Modern Times Beer (San Diego, Calif.) are among those that have been featured at such periodic events. “It was a great night; we showed up early and stayed late,” said Matt Walsh, the head brewer at Modern Times, who traveled to Singapore for the occasion. “I was really impressed with the knowledge and enthusiasm of everybody there.”
Aside from its world-class tap list and compelling, nontraditional setting, Smith Street Taps succeeds by selling premium beers at prices far lower than those found at brick-and-mortar competitors. They can do so, in part, because their overhead is much lower.
According to Singapore’s National Environment Agency, as of Dec. 31, 2014, 87 percent of hawker stalls rent for less than 1,500 Singapore dollars (about $1,065) a month, a fraction of what many centrally located bars pay.
Of course, now that the pair has kick-started this craft beer hawker phenomenon, the model has caught on. At Chinatown Complex, for instance, the brothers Patrick Lim, 61, and Steven Lim, 63, opened OnTap a few stalls from Smith Street Taps in late 2014. The approach is similar, though the Lims pour only OnTap’s own beers and ciders, brewed in small batches less than 10 miles away in central Singapore. OnTap now manages stalls in the Chomp Chomp and Sun Court hawker centers, too.
As far as Mr. Chao is concerned, upstarts like OnTap aren’t necessarily competition — they’re a sign of progress. “It’s still about growing the market and just getting more people drinking good beers,” he said.
2 Mar. 2016