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.
10+1 trends of Russian beer market 2015-2017Despite of the moderately negative prognoses for 2017, the beer market can be stabilized soon. Yet the years of the negative dynamics have resulted in marketing being limited just to “optimization” and the art of balancing between price and volumes. Bigger supermarkets share means stronger trade marketing. These processes are connected to the majority of the described trends. At the same time, the federal brands inflation leads to searching for new tastes, sales channels and contact formats that expand the product range and diversify the beer market, but do not imply a substantial volume increase. Let us enumerate and further discuss the ten trends of the beer market we can see in 2015-2017 as well as the major event of 2017.
Beer market of Ukraine 2017In the first half of 2017, the Ukrainian beer market goes on decreasing slowly. Yet, the companies manage to compensate their lost volumes by raising prices and improving the sales structures. This results in the mid price market segment reduction while the sales of premium brands are rising. These processes are connected to position strengthening of companies Carlsberg Group and Oasis and the market share reduction of Obolon. Most of the novelties by the market leaders belong to craft or hard lemon categories.
Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
PET: Energy and Resource Efficiency in the Foreground
PET is the preferred form of packaging worldwide particularly for bottling of water and non-alcoholic beverages (CSD). While the demand for CSD is rather stagnating from a global perspective, bottling water in PET continues to boom. Many new developments of PET containers are also used in the dairy industry now. Consequently, drinktec has created a separate exhibition area with PETpoint in line with its importance for bottlers, which is dedicated exclusively to PET technology and presents all innovations with relevance for PET. As probably the only trade fair worldwide, drinktec shows the entire value chain of PET in this area. The exhibitor group on the subject of PET includes manufacturers of injection molding machines to produce preforms and stretch blowing systems for plastic containers, among others, but also filling machines for plastic bottles. Representatives are also suppliers of raw materials and auxiliary materials for the manufacture of plastic containers as well as the producers of plastic bottles made from PET, PEN, PP, PE, HDPE or other plastics. Machines and systems for recycling PET bottles and closures are on the other end of the life cycle of PET containers. “Beverage closures have reached their lightweight minimum geometrically, and they thus make higher demands on the precision and repeatability of injection molding machines than ever before. With the new high-strength HD-PE materials, the requirements for plasticizing performance have also increased sharply. A third trend is the increasing sensitivity of injector molders in matters of energy efficiency. At drinktec, we will show how to combine these challenges economically,” Michael Feltes, Head of the Packaging Business Unit at Engel Austria in Schwertberg, Austria, stated. “drinktec is the exhibition in the area of beverage/closures where all our customers really obtain information about trends and innovations. As one of the market leaders in this industry, we have to be there.”
Achieve more output with fewer resources
In advance of the trade fair, drinktec is starting “Go with the flow. Southeast Asia Roadshow” in collaboration with the trade journal PETplanet. Starting from January 2017, the editorial team will tour with the Editour Mobile through Laos, Thailand, Viet Nam, Cambodia, Singapore and Indonesia for more than half a year and thereby promote drinktec. The team will be back in time for the trade fair start of drinktec in September 2017 and present the results of the tour at drinktec with detailed analyses of the PET markets in the individual countries.
What are the technological focal points in the use of PET? Recent developments such as preferential heating, i.e., the targeted heating of special bottle areas, make it possible for the bottlers to achieve perfect quality in an energy-efficient process, including with strongly oval bottle shapes. The coating of PET containers, for example, with a very thin layer of glass, is also being developed further. It reduces in material costs on the one hand and ensures a longer shelf life of sensitive beverages on the other hand.
Energy and resource efficiency are especially important for the bottlers in manufacturing PET containers. Visitors can obtain information concerning this in the context of the focus topic water and energy management at drinktec. The industry is dealing with topics such as reduced water consumption, use of process heat, recycling and the use of more efficient components. Achieving more and more output with fewer resources: this is a goal of the future, which also includes reducing PET container weights and using recycled materials.
Numerous brewery and soft drink companies have formulated ambitious goals with regard to their footprints. Especially large corporations can make a big difference. For example, when Coca-Cola promotes the goal of making packaging plastic from renewable natural resources in the future, then that has a lot of weight. The share of recycled PET in the disposable bottles of Coca-Cola Germany is already 29.23 percent now. Goal by 2020: 40% recycled PET in plastic disposable bottles.
Machine manufacturers are increasingly employing the economic use of energy and resources as a selling point, both in their own companies and above all with customers. “Every gram less of PET that we need for our bottle is an extraordinary resource saving calculated globally,” Prof. Matthias Niemeyer, Chief Executive Officer of KHS GmbH, stated. The mold-blowing machine manufacturer Sidel calculated that a 0.5-liter PET bottle weighed 28 grams in 1985, but today it has been able to reduce this to fewer than eight grams in an extreme case today.
Use of recycled materials still too low
In addition to the lightweighting, the use of recycled PET is a challenge of the future. The trend to the bottle-to-bottle recycling is continuing unabated according to market insiders. Reason: market coverage is still very low. The use of recycled materials in PET containers is still negligible worldwide and is estimated to be around five percent. However, major PET bottlers want to achieve an approx. 25 percent share of recycled material. “That's why the demand for bottle-to-bottle recycling is continuing unabated,” Dr. Thomas Friedlaender, PET recycling specialist at Krones AG, Neutraubling, explained. But the recycling expert considers the greatest challenge to be the diminishing quality of collected PET containers. “Advanced sorting technology and continuous improvement of recycling technology are indispensable conditions to be able to produce usable recycled materials from them.” For Christoph Wöss, Business Development Manager of the Bottle Division at EREMA, the trend to PET recycling is also continuing undiminished. “In this context, we are pursuing the zero-waste approach. By this, we mean that the cleaning and recycling process of PET needs to become more efficient, totally in the spirit of economic and ecological sustainability. We also detect increasing demand for the direct interconnection of the recycling process and further processing into a final product, most recently directly into food-grade preforms. drinktec is the precisely the right platform for discussing such trends.”
According to Petcore, approx. 57 percent of marketed PET bottles were recycled In Europe in 2014, 6.8 percent more than in the previous year. This corresponds to a collection of approx. 66 billion 1.5-liter bottles.
Alternatives in demand
Consequently, drinktec will also highlight the latest possibilities for PET recycling and the use of alternative materials. In the meantime, PET bottles can be made from almost 100 percent recycled materials, such as Coca-Cola has demonstrated in Germany with the introduction of a one-way deposit bottle for the product Coca-Cola Life. The research for alternatives to PET is also continuing. In a development project, containers made of PEF (polyethylene furanoate) are to be produced, which can be produced from 100 percent vegetable raw materials according to a consortium of Avantium and Alpla with participation of Coca-Cola and Danone. Scientists at the University of Hohenheim want to use the root of chicory as a basis for this. PEF bottles could be drawn thinner than PET bottles, reducing transportation costs as a result.
All in all, developments in the market for beverage containers remain very exciting. However, it is clear that they are moving in the direction of sustainability. The next drinktec will certainly contribute its part as a catalyst for ideas in the discussion about the optimum solution.
15 Dec. 2016