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. ...
Thirsty for growth, foreign brewers pile into Myanmar
Japan's Kirin Holdings and Dutch company Heineken are among those flocking to the market, which was opened after the democratization process began in 2011.
Kirin, which acquired local beer giant Myanmar Brewery last year, is aggressively making inroads with such premium offerings as the flagship Ichiban brand. Heineken, meanwhile, is planning an investment to boost local production capacity this year.
Affluent customers pour into Shan Yoe Yar, an upscale Yangon restaurant, nightly, escaping the humid, hot monsoon weather. The eatery started carrying Kirin's Ichiban draft beer in June. A 31-year-old car dealership manager says he enjoys the beer with friends, noting the beverage's smoothness. Kirin markets Ichiban as a premium 100% malt offering. Without promotional discounts, the beer is priced at 3,000 kyat ($2.53) per mug -- double that of popular local offering Myanmar Beer, sold by Myanmar Brewery. But well-off people who like to try new things are interested, according to the restaurant's manager.
In Myanmar, eateries are a major channel of beer sales, accounting for more than 80% of overall beer consumption in the country. The situation differs greatly from Kirin's home market of Japan, where "drinking in" at home makes up about 70% of beer consumption.
Kirin Senior Executive Officer Takeshi Minakata, who oversees Myanmar Brewery as managing director, says the Myanmar unit will promote Kirin offerings as premium brands at restaurants. By working with wholesalers, the goal is to increase the number of eateries serving Ichiban from around 100 or so now to 150 by the end of the year.
Outstanding growth potential
In Myanmar, per-capita beer consumption is a mere one-tenth that in Thailand or Vietnam -- at three to four liters yearly. The economic stagnation under the military regime and the stigma of women and youth drinking alcohol -- based on Buddhist customs -- kept a lid on demand for years.
But since the country began democratizing in 2011, demand has surged in urban areas. The market is expected to more than double from 2013 levels to around $700 million in 2018, according to research company Euromonitor.
In May of last year, Danish company Carlsberg launched production in Myanmar, and Heineken followed suit the following month. The Dutch company rolled out Myanmar exclusive brand Regal Seven, aiming to be the leader in premium brands. It plans to spend about $10 million this year to boost its Myanmar output capacity by about 40% to 45,000 kiloliters annually.
Kirin introduced its Black Shield Stout last fall after acquiring Myanmar Brewery. It also has rolled out the 100% malt craft beer Myanmar Premium.
It usually takes about a year to launch a new product. But Kirin halved the process by allocating managers with production expertise -- including Minakata -- to the project. "We now have a complete portfolio ready to compete in the market," Minakata says.
With a market share of 70-80%, Myanmar Brewery has an overwhelming edge over Heineken and Carlsberg, who have shares of around 10%.
But in a rapidly growing market, the competitive landscape could change suddenly.
For Kirin, the battle is a nerve-racking one, especially after a slump in Brazil. The company shelled out about 300 billion yen ($2.97 billion at current rates) for the acquisition of Schincariol five years ago, only to see its market share tumble. Kirin had to write down the operations last year and is urgently trying to turn the business around.
"We can't fail in Myanmar," says a Kirin official in charge of group strategy.
With the Japanese beer market contracting since peaking in 1994, overseas expansion is a must. But Japanese beer brands generally lack global recognition -- posing a challenge for homegrown breweries. Kirin took a 48% stake in Philippine brewer San Miguel in 2009, hoping to use its brands to propel Asian expansion.
3 Авг. 2016