The beer market dynamics in Russia is approaching zero, yet major brewers are divided into those who developed considerably in 2017 and those who considerably reduced their volumes. For instance, company Efes has managed to substantially extend their sales due to restrained pricing policy and activity in the modern trade. Heineken has also demonstrated an excellent performance promoted by significant increase of advertisement budgets launching a non-alcohol sort of the title brand and unusual activity in the economy market segment. Carlsberg and AB InBev have been focusing on margins and lost a market share of their inexpensive brands. Serious dependence on PET package and mass enthusiasm about Zhigulevskoe have negatively impacted the most of big regional brewers, that have been for the first time pressed by the leaders in the key sales channels, especially in Volga and Central regions. In the small business there has been a noticeable slowdown in appearing of new restaurant breweries, yet the number of craft breweries has been growing rapidly. In 2018, the beer market is likely to grow a little, while the share of AB InBev Efes may decrease due to the integration. ...
“Catalogue of Russian Beer Producers 2018” includes 1070 businesses ranging from large subsidiaries of international companies to rather small restaurant and craft microbreweries.The catalogue includes 32 large breweries, 75 regional breweries, 693 industrial mini- and microbreweries as well as 270 restaurant breweries. ...
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.
Asahi Eyes U.S. Beer Expansion With $3.7 Billion War Chest
Tokyo-based Asahi is willing to spend 400 billion yen ($3.7 billion) starting next year, which includes raising debt and 100 billion yen in cash, on further acquisitions, President Akiyoshi Koji said in an interview Wednesday. The company is mainly seeking overseas investments to strengthen its alcoholic and non-alcoholic beverage businesses, said Koji.
AB InBev last month accepted Asahi’s offer to buy the Peroni, Grolsch and Meantime beer brands as the European brewer seeks to win regulatory approval for the purchase of SABMiller Plc. For Asahi, completing the biggest deal in its history would help the Japanese brewer expand abroad amid falling domestic beer consumption and changing tastes.
“There’s huge potential that our Super Dry beer will gain popularity in the U.S.,” said Koji, pointing to the country’s growth in popularity of craft beers and diversified food culture. “The key is how to boost distribution power -- then we can think of bringing our whisky, Shochu spirit and non-alcoholic drinks later on too.”
The Japanese brewer is aiming to boost the ratio of its overseas sales contribution to 20 percent by 2018, up from 15 percent currently, and will look to expand in both the U.S. and Europe, said Koji, 64, who was promoted to the number two job March 24 after heading Asahi’s beer unit since 2011.
The European deal may boost Asahi’s profitability and change its earnings structure, which has been heavily reliant on domestic beer sales, according to Satoshi Fujiwara, an analyst at Nomura Securities Co.
“Asahi’s heavy dependence on its beer unit has been problematic, weighing on its top-line profit,” Fujiwara said by phone. Asahi’s earnings before interest, taxes, depreciation and amortization margin, which excludes liquor tax, is at about 14 percent while that of the AB InBev brands it’s acquiring is about 21 percent, he said.
Asahi shares were little changed at 3,628 yen by the close of Tokyo trading Wednesday. The stock has fallen 4.5 percent so far this year, compared with the benchmark Topix index’s slump of 13.5 percent.
Asahi last month reported its highest-ever first quarter sales as demand for its alcoholic beverages rose. Sales rose 1.6 percent to 380.2 billion yen in the three months ended March 2016, while net income fell 95 percent to 614 million yen. The drop in net income is due to a one-time gain related to an investment in a Chinese company booked in the same period last year, according to the company.
Recent mergers and acquisitions by Asahi, which also sells spirits and non-alcoholic beverages, include the purchase of New Zealand beverage maker Independent Liquor Ltd. in 2011. The Japanese brewer in 2009 bought a 20 percent stake in China’s Tsingtao Brewery Co. from AB InBev.
Asahi is not interested to buy a stake in Vietnam’s Saigon Beer-Alcohol Beverages, and doesn’t plan to sell its stake in the Chinese beermaker Tsingtao, despite the economic downturn in China which has hurt beer consumption, according to Koji. Shandong province-based Tsingtao reported its 2015 net income fell 13.9 percent to 1.7 billion yuan ($260 million).
“Tsingtao is striving to boost profit, so we’re supporting its effort to increase production efficiency while not having direct control over their business,” Koji said.
19 May. 2016