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. ...
India. Bihar alcohol ban: SC to hear case today; liquor factories on tenterhooks
While the state government has allowed them to continue operating their factories (mainly to protect 13,000 odd jobs), it does not want them to sell their liquor there.
On 30 September, the Patna high court overturned the liquor ban imposed in Bihar on 5 April and termed the state’s prohibition laws “illegal”, “unreasonable” and “draconian”. Two days later, the state government came out with a fresh ban with harsher provisions, on the occasion of Gandhi Jayanthi.
The Nitish Kumar-led Bihar government also moved the Supreme Court against the Patna high court’s ruling on Monday. An urgent hearing has been set for Friday.
Caught in this uncertainty are companies such as United Spirits Ltd (USL), United Breweries Ltd (UB) and Globus Spirits Ltd which have factories in the state, and some other smaller companies which wanted to bring their spirits there.
Their dilemma can be summarised thus: Does operating in Bihar make financial sense?
“As an industry, it becomes very difficult as there are investments made in ongoing businesses as well as for employment,” said a senior executive at a leading beer maker, on the condition of anonymity. “These bans are unfair as there is no opportunity given to companies to recover money and adds to the issues that the industry faces,” the person said.
In an earlier interview, Abanti Sankaranarayanan, the business head of luxury and corporate relations of USL, warned it might have to make some tough decisions.
“What it does mean is our manufacturing footprint will get reduced because like in the case of Kerala and Bihar, we will have to get out of states where liquor ban has already happened. What else can we do?” Sankaranarayanan asked.
“In Kerala, for instance, the government was telling us not to close. But we said we have no option,” she said, adding that Diageo Plc-controlled USL plans to shutter its unit in the state if the anti-liquor rules prevail.
The owner of brands such as Royal Challenge and Signature whiskies and McDowell's brandy employs around 250 people at its factory there.
USL has other plants that are self-sufficient and that helps in moving out operations from states like Bihar without slowing down production, its managing director and chief executive Anand Kripalu had said in a July conference call.
Some others want to stay, despite the hurdles that might arise when a company’s factories are away from its retail outlets.
United Breweries Ltd managing director Shekhar Ramamurthy is one of them. The company, known for Kingfisher beer, said the decision to stay in Bihar was financially viable.
Globus Spirits is “also still open to utilizing its factories in Bihar to sell to other states”, said Abneesh Roy, Edelweiss Securities Ltd’s senior vice-president in an interview.
Globus Spirits, which did not respond to requests for comments, sells Indian-made foreign liquor such as Country Club whisky, French Castle brandy and local blends such as Nimboo and Narangi.
Tax revenue from liquor sales in Bihar was Rs3,400 crore in 2014-15, according to a November research report by Edelweiss. The brokerage has not published fresh data, but Roy estimated a ballpark Rs4,000-4,500 crore in 2015-16.
“That’s a huge amount of money for a smaller state like Bihar. And of course, from this April it has gone down to zero (because of the ban),” Roy added.
The larger question is whether prohibition actually works in curbing alcohol abuse or ends up making things worse.
“As with the US and other countries who introduced prohibition, they have to roll it back. It doesn’t work. It only increases crime and black market liquor. It doesn’t allow the government to control the quality of liquor that comes in,” said Lisa Srao, chairperson and managing director of alcoholic beverage maker I Brands Beverages Pvt. Ltd.
7 Окт. 2016