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.
Myanmar. Military-Linked UMEHL Transitions Into Public Company
According to state-run media, shares for UMEHL, which was founded in 1990 with two shareholder groups, will be consolidated into one group. This move by the board of directors and shareholders will effectively transform UMEHL from a special company, under the 1950 Special Companies Act, into a public one, under the 1914 Myanmar Companies Act.
An anonymous UMEHL official confirmed the conglomerate’s organizational restructuring but could not provide any additional details.
UMEHL has many businesses to its name, including Bandula Transportation, Myanmar Brewery Limited, Myawaddy Bank, Myawaddy Trading and, more controversially, jade mines in Kachin State.
Soe Tun, chairman of the Myanmar Automobile Dealers Association and vice president of the Myanmar Rice Federation, said he welcomed UMEHL’s transformation because it meant that it would have to follow the same rules as most other companies.
“It [UMEHL] will be more transparent and there will be equal chances for other businesses,” Soe Tun said.
Under military rule, UMEHL was free to monopolize businesses in various sectors.
“For example, it monopolized the beer and cigarette markets. … We couldn’t compete with them on a level playing field,” said a local, Rangoon-based businessman.
Zaw Lin Htut, chief executive officer of the Myanmar Payment Union, said that while UMEHL’s profits would not go toward the government’s budget, the organization will have to pay taxes according to the Public Companies Act.
“As a public company, there will be more transparency and accountability, and more responsibility, too. They’ll have to pay taxes,” Zaw Lin Htut said.
“But if the Defense Ministry is a shareholder, they [the ministry] will receive a dividend, and according to tax law, no taxes would need to be paid on this dividend,” he added.
In the past, UMEHL and its many different businesses have been accused of tax avoidance. Since Burma’s shift to a quasi-civilian government in 2011, however, they have frequently topped the annual list of corporate tax payers.
1 Apr. 2016