Europe: Baltika targets to take Heineken’s 1st position

Russia’s largest brewer, Baltika, wants to dislodge Dutch rival Heineken from its dominant position on the European beer market, despite a slowdown in Russia, a company official said, according to Reuters, April 6.

"Baltika is confidently gaining ground on the market leader Heineken. In the near future we will be the No. 1 in Europe," marketing vice-president Marcho Kuyumdzhiyev said.

Baltika, which is controlled by Scottish & Newcastle and Carlsberg, sold 37.16m hectolitres of beer in 2006, including 11.6m hectolitres in Europe.

Russia is the world's fifth-largest beer market behind China, the US, Germany and Brazil and together with China is one of the world's fastest-growing, boosted by rising real disposable incomes. Kuyumdzhiyev said Baltika planned to meet its target via sales on the domestic market and in the former Soviet Union.

But analysts believe that the world's beer market is close to saturation, and say current double-digit growth rates are already slowing down.

Analysts had forecast Russia's beer market would grow by 4.0-5.6pc in 2006, but it soared by 10pc due to an unusually warm summer.

The result was however, a slowdown compared with 2005, when the market grew by 12.5pc. Baltika forecasts the Russian market would grow 3-5pc in 2007 and the next few years, but Kuyumdzhiyev said he believed the slowdown in domestic market growth would not prevent it from catching Heineken.

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