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4-2017

Global hop market

A 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 Russia

Germany 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.

India. United Spirits Limited gives Beer lovers a new taste of Whiskey

While USL hasn't tweaked the alcohol content to make the new product less potent, there could be a consumer perception of it being a tempered down whiskey.

2016-09-27_11h05_56 United Spirits, India's largest spirits firm, is launching the country's first homegrown flavoured whiskey to target beer drinkers who find the regular drink too strong or overwhelming. The new brand — Silk, a honey-flavoured drink under the McDowell's portfolio — is the first product launch after Diageo acquired USL about four years ago.

"A significant portion of beer drinkers actually never embrace whiskey, because they found the whisky taste to be unpalatable. These consumers like the sophistication of whiskey, but they find the taste to be either strong or harsh and never embrace whiskey as a drink for those lighter social occasions," said Amrit Thomas, chief marketing officer at USL.

For British parent Diageo, the innovation portfolio rose to £1.5 billion in global sales in 2015 from £700 million in 2010. The Indian unit wants to mirror that. "USL aims to get about 20 per cent of its sales from new product launches and another 30 per cent by renovating existing brands by 2020," Thomas added. Over 180 people are employed in dedicated innovation roles around the world for Diageo with 15 executives stationed in India.

While USL hasn't tweaked the alcohol content to make the new product less potent, there could be a consumer perception of it being a tempered down whiskey version, said experts. "Flavoured whiskey has met with modest to high level of success globally. In India, the challenge could be changing the mindset of youth in accepting a flavoured whiskey," said Sandeep Arora, a whiskey connoisseur, and director of Spiritual Luxury Living, a luxury spirits and whiskey management company.

At a 10 per cent premium, the new brand will hit the market by early next year and is being currently test-marketed in a few states. McDowell's is the largest brand within Diageo's portfolio by volume, with annual sales of 26.4 nine-litre cases in 2015.The company hopes to achieve 5 per cent of the brand sales from the flavoured variant.

27 Sep. 2016

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