Dmitry Nekrasov’s Philosophy — on the Past, Present and Future of Ukrainian Brewing IndustryA meeting with Dmitry Nekrasov always turns into a training course: “Introduction to brewing business“. We are talking to a clever “playing trainer“ a person that can be called a godfather of the Ukrainian craft. He has a dozen of successful projects to his name. Dmitry told us about craft beer in Ukraine, on market cycles, on specifity of operating in retail and HoReCa, on union of Ukrainian brewers and certainly, how a brewery of his own, First Dnipro Brewery is doing.
The market of import beer in Russia: review and databasesThe market of import beer is rapidly growing and changing. But while in the past years it was growing due to brands variety, in 2019 major and affordable brands from TOP-10 were developing actively. It seems that the fact of a brand origin from far abroad counties, even if it is not well known but has moderate price and good distribution provides for million liters of sales in the territory of Russia. Among distributors AB InBev Efes was far behind, yet the role of Baltika and suppliers of the second row got more important. The boom of German brands was followed by stagnation of import from other traditional regions (and Belarus) instead the supplies from Mexico, Lithuania and Asian countries grew considerably.
Russia: Positions of Brewing CompaniesThe review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.
Ukrainian beer market 2019: companies and brandsIn 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.
Brewing industry in Kazakhstan 2019During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.
The trend of complication of Russian beer market is going on and in several directions at the same time. The range has got wider, the import and small segments are growing, namely craft beer, alcohol-free beer and special flavor beer. At the same time, all ex-mega brands and light lagers by Russian brewers are experiencing a decline of their shares. AB InBev Efes, Heineken, MBC and Pivzavod Trekhsosenskiy have exceeded the market, Carlsberg was developing slower than the market and Ochakovo as well as some other mid-sized breweries have been cutting down their volumes. To a big extent brewers’ performance was connected to their ability to reach agreement with networks, sacrifice their margin and enter new markets. Craft brewers are facing a serious danger of producers’ registration introduction – de facto licensing. ...
The rise of craft beer in Malaysia
Craft beer may not be making the sort of waves in Malaysia that it is in the United States, but there IS a growing market and demand for craft beers here. Where we used to only get beers from the two major breweries – Guinness Anchor Berhad and Carlsberg Malaysia, there is now a much bigger selection of beers from all over the world available in craft beer outlets such as Taps Beer Bar, The Great Beer Bar, Ales & Lagers, and Messrs Barley, Malt & Hops.
But what is craft beer anyway? The term used to mean beer made by microbreweries brewing, or rather, crafting, beer in small quantities.
The United States’ Brewers Association (BA), the trade association representing small and independent American craft brewers, defines craft beer as beer made by brewers that are small (with an annual production of six million barrels of beer or less), independent (less than 25% of the brewery is owned or controlled by an alcoholic beverage industry member that is not itself a craft brewer), and traditional.
However, the industry has grown by such leaps and bounds these days that this definition seems outdated now. In data released by the BA last year, craft beer reached double-digit volume share in the US for the first time ever, accounting for 11% of the overall US beer market.
Many of the so called “craft beers” these days are now mass produced as well. In fact, some of the more successful craft breweries have even been bought over by mega-conglomerates, for example, the recent US$1bil sale of US craft brewer Ballast Point to Constellation Brands (STZ), which makes Corona Extra.
“It’s hard to define what ‘craft beers’ are these days. It used to mean handmade and small batch, but these days it is not even that anymore,” says Kennhyn Ang, founder of two craft beer outlets in Kuala Lumpur – The Great Beer Bar in Damansara Utama, Petaling Jaya, and Ales & Lagers at Solaris Dutamas, Kuala Lumpur.
What is certain, however, is that craft beer tends to be beers brewed with traditional methods in smaller breweries (as opposed to the massive mechanised factories utilised by major commercial brewers), and are generally “crafted” to produce a high-quality beer with an emphasis on flavour.
Unlike commercial beers, which usually tend to be mostly lagers or pilsners, craft brewers don’t limit themselves to just one style, brewing everything from ales, pale ales and India Pale Ales (IPA), to stouts, porters and sours.
Craft brewers also tend to experiment a lot, from often using different brewing methods, different species of hops or yeast, or even unique ingredients such as pumpkin and tea in the brew. Hence, many craft beers don’t taste like commercial beers at all – instead, you’ll find some that taste like peanut butter, doughnuts, and even bacon, despite not having those ingredients in them… Some even have crazily high alcohol volumes – Scotland’s Brewdog famously made a beer called Sink The Bismarck which contained a whopping 41% alcohol by volume (ABV), which is the same as a whisky!
From fan to bar owner
As the founder of beer blog Beerbeer.org, Ang was one of the early supporters of craft beer in Malaysia, so it is perhaps fate that led him from being a mere beer enthusiast to opening his own craft beer outlets. In 2012, he opened bottle shop Ales And Lagers, which stocks bottled and canned beers from all over the world, including the US, Australia, Britain, Europe and Japan. The little bottle shop gained a respectable following amongst beer enthusiasts in Malaysia, and gave Ang the confidence to open The Great Beer Bar last year.
According to him, while the craft beer market has certainly grown in the past five years, it is still a challenge to educate and create awareness about craft beer in a country with drinkers that are more acquainted with the more traditional, commercial brands.
One of the biggest hurdles in capturing this new market, is the price.
A 350ml glass of craft beer at The Great Beer Bar sells for an average of RM30, so it’s hard to begrudge potential customers who leave immediately after viewing the menu, and head to a nearby bar for its RM50 for three pints promotion!”
“It’s fun if you are able to let someone try something new, but it’s still not easy because of the price point,” said Ang. “Also, we are selling brands that most people have not seen before, so it’s still a challenge to convince people to try the beers.”
Still, for that seemingly high price, you are getting a beer that is flavourful and high in quality, which you can slowly enjoy. Just like a wine, in fact.
“People don’t generally go to wine bars to get drunk – they go there to taste different wines,” says Mili Lim, co-founder of Taps Beer Bar. “It’s the same here – you come to Taps to try different beers. That’s what craft beer should be about.
“We can’t compete with the big brewers in terms of price, that’s for sure. And we are not trying to. For a RM100, you can get a large volume of commercial beer, but here, you get three or four quality beers,” added Alvin Lim, Mili’s brother and fellow co-founder (the bar is co-founded by them and three of their cousins, Aaron Lim, Adrian Chong, and Brian Chong).
Tapping a new market
The 2011 opening of Taps Beer Bar on Jalan Nagasari in the heart of KL city was a watershed moment in the Malaysian beer scene – for the first time ever, we had a bar that truly specialised in craft beer. Situated just a stone’s throw away from the party hub of Changkat Bukit Bintang, the bar boasts an impressive 14 taps, serving a myriad of different craft beers, as well as a bottle list with almost a hundred beers in all sorts of styles.
A second outlet opened in Mont Kiara about two years ago, and every year around September, Taps holds the hugely popular “Better Beer Festival” at its KL outlet.
According to Mili, since the bar opened, they have seen their clientele grow from being mostly frequented by foreigners, to more local beer lovers currently. “When we first opened, we had a mostly tourist and expatriate crowd. The locals who came were those who had travelled overseas and were exposed to craft beer before. But now there are more locals. And that’s a positive for us, because it shows more Malaysians are drinking craft beer.”
If you’ve walked into any of the craft beer outlets lately and been confused by the sheer number of different beers, brands, and beer styles, don’t fret – you are not alone. “Confusion is the norm here!” said Mili. “That’s why we have to train the staff to explain the menu and the beer.”
“People also get excited when they see the high alcohol percentage of our beers!” Alvin added. “Most beginners can’t even take the light hoppy bitterness of the lighter styles, let alone the heavier ones.”
For beginners, Lim advises starting off with a lighter beer style. “Beginners should start out with the pilsners, lagers, and pale ales – beers that a bit fruitier and more citrusy. We can’t move them straight to double IPAs or imperial stouts, as they might not like it, and end up not coming back,” he said.
“We also explain to new craft beer drinkers that these are very different beers from the ones they are used to, and that they should not be looking to get smashed or drunk. The most important thing is to have an open mind, and not be afraid to try the beers.”
The newest craft beer outlet on the block is Messrs Barley, Malt & Hops in Taman U Thant, KL. Its owner, Kenneth Dielenberg, has been working in the service industry in pubs, bars and hotels since 1995, and certainly has enough experience to be able to spot an upcoming trend in the drinking scene.
“I think the Malaysian market is now ready for craft beer. We do have a strong beer drinking culture, and there are more people travelling more and coming back having tried craft beers. But we still need to do a lot of education for the others,” he said. Messrs Barley, Malt & Hops is also a bottle shop like Ales & Lagers, and even provides a limited delivery service for customers around the Ampang area.
Although there are arguably only five specialty craft beer outlets in the country (all in the Klang Valley, including Taps’ two branches), the availability of these beers has certainly improved. Between the five outlets, there are easily more than 200 different types of craft beer available, along with some small distributors bringing in smaller quantities of craft beer, and some cafes and major supermakets such as Ben’s Independent Grocer which have also started carrying craft beers as well. Online wine and spirits store WineTalk also recently branched out into craft beers as well.
Having more places serving craft beer is key to helping the market in Malaysia grow.
“It’s all about awareness about craft beer at this stage. Having more outlets with craft beer definitely helps the whole market,” said Mili, adding that there has also been a shift amongst customers from being brand conscious to being more focused on variety and styles.
“We see people being more familiar with variety and styles these days, but it is still a constant process to teach the local community that craft beer doesn’t have to be about one or two brands.”
For Ang, the key to creating more awareness about craft beer is to promote the fun aspect. “In the end, beer, whether a craft or commercial, should be about fun. But in craft beer, there’s the added innovation the brewers put into their beers. There’s no denying how much fun it can be going to a place like Taps and seeing 14 different beers on tap, and deciding what to try first!”
With so many different styles of beer available at a craft beer joint, deciding what to order can be tricky. Here’s a quick guide to the more common styles of beer available:
What is it: The most popular style in the world, and the staple of most commercial breweries.
What it looks like: Golden, yellow, usually quite carbonated (or gassy).
What it tastes like: Usually crisp, refreshing and not very flavourful.
What is it: Beer made with wheat.
What it looks like: Usually pale and cloudy.
What it tastes like: The cloudy look is caused by the yeast in the beer, so you get some rather yeasty notes.
What is it: A beer made by warm, top fermentation, using mostly pale malt. One of the more common craft beer styles.
What it looks like: Paler than a lager, sometimes amber-coloured.
What it tastes like: Depending on the brewer, pale ales can be hoppy, spicy, with earthier notes.
What is it: The name stands for “India Pale Ale”, and it is a pale ale with a higher emphasis on hoppiness.
What it looks like: Pretty much like a pale ale.
What it tastes like: Hoppy, hoppy, hoppy. An IPA usually has an emphasis on a particular hop profile, though the best ones are those with a perfect balance between the hops and the other flavours.
What is it: Ale made with browned, or roasted barley malt.
What it looks like: Porters are usually dark brown, stouts tend to be a lot darker, almost black.
What it tastes like: Rich, full-bodied, malt, chocolates, coffee, mocha… these are the usual tasting notes associated to porters and malts.
What it is: Beer that is brewed to be intentionally sour, either by using a certain strain of yeast, or by adding fruits to the brewing process.
What it looks like: Varies depending on the ingredients used. Some made with fruits like cherries and berries take on the colour of the fruit.
What it tastes like: Sour. Duh. The appeal of a sour is getting the balance between the sourness and the other flavours. Aged long enough, some Belgian lambics can even taste like champagne.
22 Фев. 2016