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.
Chinese beer slowdown but silver lining emerging
However, while this is a huge concern to Australia’s malt barley industry, leaders from within the malt industry have said the change in drinking habits in China towards a preference for imported premium beer and lower malt production from Europe may soften the blow.
Speaking at the Barley Australia forum in Adelaide last month, Paul Rigoni, Barrett Burston Malting, said the slowdown in the Chinese economy was lowering consumption among poorer consumers while the more affluent were switching towards imported beer.
Trevor Perryman, Malteurop, said the Chinese malting sector also had an image problem among its neighbours.
“Throughout Asia, consumers are often a little suspicious of food products of Chinese origin and this applies to malt.
It all boils down to a slowdown in the Chinese malting industry, but Mr Perryman said it was not necessarily bad news for Australia’s barley sector, saying Australian-produced malt would be in demand.
“Australian malt still has that premium image so it may be that we have the odd situation of us being a niche player on a macro scale.”
“We’ve got good authenticity and good accreditation process and that will go a long way.”
The scale of the production numbers in China are staggering, there is still more unused capacity for malting that can be turned on than the entire malting capacity in Australia.
However, Mr Perryman said it would not necessarily translate into competition for malt exports.
“A lot of the capacity is inland and it can’t be exported economically.”
Mr Rigoni said Australia also had good opportunities in emerging beer drinking markets such as Vietnam and Myanmar where beer consumption is rising quickly.
He also highlighted India as a market to watch.
“The country will be a complex market, but it is big and will get bigger.”
Domestically, Australian farmers are benefiting from the rise of the high value craft beer industry.
“In Australia, nine per cent of the total dollar value of the beer industry is from craft brewers and we have seen over 100 new breweries come on line over the last couple of years.”
“The craft beer industry is now worth $400 million out of a total beer market of $4.3 billion.”
Mr Rigoni predicted potential further growth, saying in the US, a similar market to Australia, the craft sector was worth 19.3pc of the total beer market.
He said craft beer was good for maltsters and barley producers as it had high inclusion rates of barley.
And it will not just be the Australian craft beer boom that benefits Aussie barley producers.
“We are starting to see craft beer made in Japan and Korea and they may look to use Australian barley in their product.”
6 Oct. 2016