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. Tasmac buys 40% more beer to slake election thirst
For March 2016, orders for nearly 26 lakh cases of beer were placed as against 18.4 lakh cases in February, an increase of 40%. For March 2015, Tasmac procured 20.9 lakh cases of beer from various breweries.
For IMFL, the state-owned entity placed orders for 57.2 lakh cases for March 2016, making the state the largest liquor market in India by volume. Brandy comprised the bulk of the order (48 lakh cases). Unified Andhra Pradesh was the second biggest market for liquor companies. Tamil Nadu is crucial for spirits companies with monthly sales of around 5 million cases.
Tamil Nadu's liquor market, tightly controlled by a state corporation, normally sees a shake-up following any change of government. With prohibition being the central political theme of the upcoming election, the fate of an industry which contributes more than Rs 30,000 crore to state's revenues hangs in balance.
Tasmac operates over 6,600 retail shops. Private participation is limited to about 1,000 bars and 90-odd clubs in the state.
"There is an increase in beer procurement primarily to take care of the severe summer. As regards IMFL, it could be to complete year-end targets," an official said.
Almost all political parties are campaigning hard with prohibition as the factor to win women voters. "What happens to the man who wants to have a drink? Is any political party thinking of him?" a CEO of a liquor firm quipped.
Total government revenues in Tamil Nadu grew 9.5% for the year ended March 2015 to touch Rs 27,823 crore. "For the current year, the numbers could be much higher as Tasmac effected two price hikes — one for excise duty and the second for manufacturers," sources said.
The growth in business has been astounding for companies with political connections, while independent liquor companies have suffered a drop in procurement.
For instance, orders for Golden VAT, a company with links to former DMK minister TR Baalu, grew from 15,000 cases in 2010-11 to 35.7 lakh cases in 2015-16. However, Elite, a distillery controlled by associates of former Union minister Jagatratchagan of DMK, saw orders drop to 50.9 lakh cases from 65.2 lakh cases between 2010-11 and 2015-16. Midas, an entity close to the ruling AIADMK, rose like a phoenix during the past five years. Its orders spiked to 112.9 lakh cases in 2015-16 from a meager 31.9 lakh cases in 2010-11.
On the contrary, United Spirits lost market in TN with orders falling to 54.5 lakh cases from 97.4 lakh cases between 2010-11 and 2015-16. Empee too lost out on business with orders falling to 30 lakh cases in 2015-16 from 40.4 lakh cases in 2010-11 while MBDL received orders for 24.4 lakh cases as against 35.6 lakh cases.
14 Apr. 2016