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.
The road to the smart supply chain
What precisely does the term intralogistics cover? Basically intralogistics, like logistics, is about the handling and flow of goods and materials. But with intralogistics, this takes place not on the roads, but instead within a company site. The processes include the packaging of goods in crates, wraparounds or baskets, sorting them onto pallets for the individual orders and then dispatching them. And also, the raw materials or new glass bottles have to be brought from the stores to the point of use.
Fast, flexible and down to batch size 1
Over the years this in-company flow of goods has changed from being a “necessary evil” into an important factor in the creation of added value in a company. Because only companies who can deliver the product fast and with flexibility, and without tying up or using capital unnecessarily, will win out against the competition. In terms of speed: Ordered today, delivered tomorrow? In many applications even this is no longer enough. “Same day delivery” is now almost a must, especially in online food retail. To achieve this, delivery chains have to be adaptable. Because the markets themselves are changing all the time. Also: The order quantities are getting ever smaller. Batch size 1 is a serious goal. For beverage or food manufacturers the number of different packagings will therefore continue to rise. And with it, so, too, will the need to package, palletize and transport the variety demanded by the customer more efficiently.
Packaging and labeling in logistics is a sensible choice
In this context, a shift from production into logistics is being seen, as Thomas Lehmann, Managing Partner of BMS Maschinenfabrik GmbH, explains: “Aiming to realize this tremendous variety inline is something for the really big companies. They can process such large-sized batches that it is worth switching over an entire filling or packaging line.” For small and medium-sized businesses—they make up around 60 percent of the trade visitors to drinktec—Lehmann suggests therefore another way: “In this case we place the filled product with the highest efficiency into the standard crates, then drive these to the logistics center where the products are repackaged as required for transport or final sale in a compact and highly flexible repackaging system.” The advantages of this solution include: optimized transport routes, greater efficiency and reduced handling processes in the bottling hall, improved planning security thanks to demand-oriented repackaging with the latest expiry date and no layer of dust on the packaging. Lehmann identifies another process step that could be shifted to the repackaging area: “Labeling could also be a job for logistics. In this case the repackaging system takes on the task of unpacking the bottles and then places for example the just-in-time labeled bottles destined for the export market into the dispatches packaging.”
In terms of beverages dispatch: Here, too, drinktec will be showcasing interesting solutions, in particular for returnables. These include on the one hand beverage crates that are compatible with lots of different returnable multipack variants. A second solution—which is already popular in Austria—is what´s known as “carrier trays”. These flat re-usable trays are filled with standard bottles or multipacks, then stacked and finally delivered to the sales floor for use as a kind of shelf replacement. Also, once the produce has been sold, these carriers can be used for returning the empties.
4.0 is bringing new impetus
But back to intralogistics: IT and automation solutions have long been a firm component here. Luigi Panzetti, Managing Director of the Italian System Group, for example, noted at drinktec 2013: “The beverage world is increasing its interest in automated systems for intralogistics, and the level of investment is growing. We believe this fair is the best opportunity to meet customers from the beverage industry, to discuss strategic issues related to their future developments, including automation to support growth and efficiency."
Currently a theme with global impact is giving new impetus in this area. “On the user side, Industry 4.0 is coming ever more strongly into focus,” is how Sascha Schmel, Managing Director of the VDMA Materials Handling and Intralogistics Association, summed up the current developments. And that means essentially: The beverage and liquid food industry is increasingly prepared to take on integrated and automated solutions. Some of these 4.0 ideas have long been a reality in intralogistics, too: transport systems that organize their in-company routes autonomously, and palletizing robots that identify empty slots in real time and fill them up. These are just two examples of intralogistics solutions that, thanks to innovative IT, can become internal “full-service providers”—and organize their operations autonomously.
The “Internet of Things” as the missing link
So, what can we expect next? The future is certainly going to belong to continuous integration all along the “smart supply chain”, from raw material through to the final customer. This is being made possible by the “Internet of Things”: Worldwide already 20 billion items have their own IP address and are fitted with a chip or sensor and connected to the internet. These items can thus be localized and identified. But they can also interact autonomously with each other. For example, the fridge that when informed via a weather app that it will be a very hot night, independently orders beer and meat for the barbecue—the production and delivery of this order is then also organized and processed autonomously. This vision is not as far off as it seems. A few months ago in the US, the first self-driving truck delivered 2,000 cases of Budweiser beer a distance of 120 miles. True, this is an example of external logistics, and not intralogistics. But in this field, too, the current trends and future developments will be on show at drinktec 2017. And that makes drinktec also very interesting to retail distributors. An attraction that is further enhanced by the leading trade fair for the entire German specialist retail trade in beverages and convenience products—PRO FachHandel. In 2017 this event is being held for the first time in parallel with drinktec in Munich. PRO FachHANDEL will be taking up Hall B0 and the foyer of the ICM—Internationales Congress Center München, which is adjacent to the Messe München exhibition center. Alexander Berger, the CEO of GES (the organizing company) and responsible for PRO FachHANDEL: “The trade fair platform is becoming even more attractive for visitors and exhibitors from the entire retail industry with the collaboration. PRO FachHANDEL with its special areas of Newcomer Market and Beer Live fits perfectly in the supporting program of drinktec.”
13 Feb. 2017