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.
China’s CR Beer says cost controls boosted first half profit by 45pc despite lower sales
CR Beer reported a net profit of 605 million yuan compared with 417 million yuan for the same period a year earlier, while revenue dipped 1.8 per cent to 15.21 billion yuan, according to the company’s filing to the Hong Kong exchange. The revenue figure fell short of analyst consensus estimates of 19.61 billion yuan.
The state-owned beer maker, which co-owns the world’s largest selling Snow beer brand with London-based SABMiller, blamed the flagging economy and severe flooding across many parts of the country as factors pressuring the company’s earnings, but highlighted cost control measures that boosted profitability.
“We expect a slower growth in sales volume than before and progressive consumption upgrades in the future,” said Chen Lang, chairman of CR Beer, which is a subsidiary of Hong Kong-based state-run conglomerate China Resources.
“Riding on the group’s track record in mergers and acquisitions, we will evaluate potential investment opportunities to expand our business and extract value through synergies,” Chen added.
Zhu Danpeng, an associate with China Branding Research Institute, said; “The entire beer market is struggling in China, but CR Beer fares better than its domestic peers as it receives solid backing from the government when competing with foreign rivals such as AB InBev.”
Before the results announcement on Friday, CR Beer shares edged down 0.26 per cent to settle at HK$15.60 by the lunchtime break. The shares have risen 22.8 per cent in the past six months.
No interim dividend was declared, as was the case a year earlier.
In July, CR Beer raised HK$9.5 billion to buy the remaining 49 per cent stake in China Resources Snow Breweries, a joint venture with SABMiller, and to gain full control of the Snow beer brand. The acquisition of SABMiller’s stake is anticipated to be completed by the end of this year.
The mid-to-high-end Snow brand is the world’s largest selling beer, accounting for 23.2 per cent of the beer market in China in 2014, outpacing its smaller rival Tsingtao Brewery and AB Inbev’s Harbin Brewery, according to research firm Euromonitor.
But CR Beer is facing a shifting preference among middle class Chinese consumers who are turning to foreign brands such as Denmark’s Carlsberg and AB InBev’s Budweiser in the premium market segment.
A merger and acquisition frenzy has swept across the global beer market, with AB Inbev’s US$108 billion takeover of SABMiller set to create the world’s biggest player, while CR Beer revealed in July its interest in buying smaller peers at home or abroad.
“CR Beer may be eyeing companies like Beijing Yanjing Brewery in this wave of consolidation,”said Zhu. “The endgame will be that the domestic market will be dominated by a single player.”
Shenzhen-listed Beijing Yanjing Brewery is the country’s third-largest beer maker. The Beijing municipal government-backed brewer was said to have been reaching out to companies, including overseas ones, for a potential stake buyout since early 2015.
19 Aug. 2016