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3-2019

Russia: Positions of Brewing Companies

The 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 brands

In 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 2019

During 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 Russian aluminum king was asked not to destroy the beer industry

The Union of brewers appealed to Oleg Deripaska, the President of Rusal with a request not to lobby for the prohibition of PET packaging, “Beer Business” writes.

At the end of March, the Prime Minister Dmitry Medvedev instructed to accelerate the adoption of the bill on the gradual reduction of production and turnover of alcoholic products in the consumer packaging made of polymeric materials. The Prime Minister suggested the state Duma to consider this issue in the spring session, and to report the results on June 1. The decree was taken following the meeting on Motovilikhinskiye plants in Perm, dedicated to ferrous and non-ferrous metallurgy.

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At the meeting, Deripaska said that the rejection of PET would contribute to the development of the aluminum industry. However, the Union of brewers does not agree with his point of view. “Maybe you think that the ban of plastic will switch the consumption of beer in aluminum cans, but it's not. We know our consumers and understand what they are buying beer in plastic because it is much cheaper. Many of them simply can't afford the product in a wonderful package from your “winged metal”. As a result of this ban, they will switch to cheap vodka, and in glass bottles,” this was said in an open letter.

The effect of the plastic ban will result in an additional sale of several thousand tons of aluminum. The market participants predict that the demand for aluminum cans will increase by a few percent, but the demand for beer in general will fall by 20-30%. “The regions will lose 40 billion rubles in taxes, tens of thousands of people lose their jobs, and alcoholism will grow. Do several thousand tons of aluminum worth all of this?” the brewers ask at Deripaska.

According to them, nearly a quarter of the Russian beer is packaged in aluminum cans, it is used glass and PET for the rest. At the same time, the Union of brewers approves the increase in the demand for beer in aluminum cans because it is more expensive and brings higher profits. But the demand will recover without any restrictions, with the rise in living standards, the manufacturers say.

The Union of brewers asked Deripaska not to use his influence in the government and among the deputies for “the destruction of the brewing industry”. It will not bring you any additional benefits, but this will do great damage to the country,” the authors conclude.

We will recall that last year the National Union of Consumer Rights Protection has launched an advertising campaign called “Ban the plastic bottle – save Russia!” The campaign also included the full-screen banners that can be seen on the websites of the newspapers Vedomosti and Kommersant, and billboards on Rublevsky highway. At the same time, the petition for the ban of PET for beer moved on in social networks.

18 Апр. 2016

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