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.
Thailand. ThaiBev’s Tipsy Valuation Risks a Hangover for Investors
Fully 63 percent of working-age Thais are teetotallers, according to a 2007 study, and yet trailing 12-month revenues at the maker of Chang beer and Mekhong rum have risen 53 percent over the past five years.
You might expect the death of Thailand's King Bhumibol Adulyadej last Thursday to have interrupted this revelry. Public drinking will be frowned on during the 12-month period of mourning and ThaiBev's own website was switched into somber black and white to mark the event. Alcohol sales will be more strictly limited to particular times of the day, according to the Guardian, and hypermarket giant Tesco Lotus suspended all sales of alcoholic drinks, according to AEC News Today.
ThaiBev shares' peak gain Friday
If that's bad news for ThaiBev, someone omitted to tell the shareholders. After falling last week as the king's health worsened, the Singapore-traded stock rebounded with a 1.7 percent gain ahead of the official announcement of his death. In a classic example of sell-the-rumor, buy-the-fact, it rose as much as 3.8 percent on Friday -- the sharpest gain since July. By the close of trade it had only modestly underperformed the benchmark SET index over the period since the King was hospitalized.
Part of this may represent doubts that the mourning period will turn out to be quite as stringent as everyone expects, though the wailing crowds thronging Thai streets since news of the king's death broke argue against such a conclusion.
ThaiBev's very success is a testament to the country's relaxed interpretation of some of its moral codes. Indeed, one 2002 paper found that Thai men who'd spent periods in their youth living in Buddhist temples were more likely to be heavy drinkers in adulthood than those who had not -- the opposite of what would be expected if the sanction on alcohol was unbreakable.
It's certainly not based on an expectation that ThaiBev's other businesses will help the company ride out a decline in drinking: Just 4.1 percent of its 2015 revenues came from overseas, and 13 percent from food and non-alcoholic drinks.
Shareholders at present give ThaiBev a forward price-earnings ratio of 21 -- bang on the median for brewers and distillers globally with more than $1 billion in trailing 12-month sales, and ahead of the likes of Diageo, Heineken, Carlsberg and Kweichow Moutai. If more Thais respond to their monarch's death by abstaining from alcohol than choose to drown their sorrows, that valuation could start looking tipsy.
This column does not necessarily reflect the opinion of Bloomberg LP and its owners.
-By market capitalization.
-It's often described as a whisky, but is made principally from sugar cane, not malted grains.
17 Oct. 2016