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.
China’s taste for craft offers fizz for global brewers
China is key for the biggest international beer brands as growth elsewhere stalls, accounting for half of the industry's global volume increase last year.
But while China drinks a quarter of the world's beer, it accounts for only 3 percent of brewers' profits, Deutsche Bank analysts estimate.
"The premium segment will be an important battle ground for brewers going forward because it will be the main growth driver," said Shanghai-based Rabobank analyst Katharine Song.
"Brewers are adjusting their strategy to focus more on high-end products."
Until recently, volume and distribution networks have been the name of the game, driving global industry consolidation through ever larger deals and crushing margins.
In 2004, about half the world market by volume was controlled by the biggest 10 brewers, according to industry data. By 2014, 47 percent of volumes and three-quarters of profits were controlled by just four brewers - AB InBev (ABI.BR), SABMiller (SAB.L), Heineken NV (HEIN.AS) and Carlsberg (CARLb.CO).
That number is soon to drop to three, with the planned $100 billion-plus (71 billion pound) takeover of SAB Miller by AB Inbev.
FOLLOW THE MONEY
Last week's sale by AB InBev of SAB Miller's 49 percent stake in China's top selling brand Snow to China Resources Beer for an unexpectedly low $1.6 billion was primarily aimed at satisfying regulators and wrapping up the merger.
Critically, it also freed up SAB Miller to focus on more lucrative bets in the Chinese market than a beer which sells at 50 U.S. cents a bottle, or less.
The focus on premium products reflects a shift in China's 1.4 billion consumers, who now want more tailored and individual products from fast-food to travel - a headache for firms from KFC-owner Yum Brands Inc (YUM.N) to luxury goods maker Prada SpA (1913.HK).
Premium beers are expected to make up over a third of the $80 billion Chinese market by the end of the decade - compared to less than 10 percent in 2010.
Imported high-end beers saw a 60 percent jump last year as consumers splashed out on brews such as "Hop Zombie" and "Armageddon IPA".
For drinkers like bar owner Chen Jiaqi, who flew over 400 miles (640 km) to Shanghai from the central Chinese city of Wuhan to sample a New Zealand craft ale, it is about individuality.
"I think more and more Chinese customers are about the flavour of the beer itself, and if the beer is unique and rare then they will choose it," said Chen.
That comes at a cost.
A bottle of craft ale costs around 30 yuan ($4.6) in Shanghai, around ten times more than the cheapest mass-market beers from Tsingtao Brewery Co Ltd or CR Beer.
"It is rare and unique and the flavours are better," said Hao Xiaowei, a 33-year-old nurse, while she drank a Bavarian wheat beer at a craft bar in downtown Shanghai.
"It's worth spending the extra money."
That willingness to splash out has attracted a host of small craft brewers such as Scotland BrewDog and New York's Brooklyn Brewery, who have started actively targeting China.
"China's on the hit list to tackle in the near future," said Luke Raven, director at Ilkley Brewery in northern England which has craft beers with names like "Hanging Stone" and "Holy Cow".
Craft beers won't appeal to all, but a willingness to spend more to stand out from the crowd will also support mainstream imported brands like Budweiser, Heineken or Japan's Asahi.
Premium beer sales grew just under 25 percent last year versus 7.5 percent growth in the overall market, Euromonitor data shows.
"Sometimes people choose premium beers – Heineken or Carlsberg for example - because it has a marketing angle or image, a certain attraction like going for a coffee to Starbucks," said Michael Jordan, brewmaster for Boxing Cat Brewery in Shanghai, which makes craft beers using local ingredients such as Sichuan peppercorns and goji berries.
"It's a kind of status symbol."
9 Мар. 2016