World: Global beer market to expand steadily

The global Beer market is expanding steadily despite a continued decline in the traditional strongholds of West Europe and North America. Since 1999, world consumption has risen by over 16% with Asia, East Europe and Latin America generating much of this growth.

According to “Global Beer Trends 2005” as of November 14 , a brand new report from leading beverage industry analysts Canadean, Asia is the fastest growing major market. Buoyed by China, consumption of Beer in the region is accelerating by more than 6% per annum.

Chinese drink one in five…

China is the world’s foremost national market and is almost a third larger in volume terms than its nearest rival, the USA. China also accounts for nearly a fifth of global Beer volumes, a figure that is expected to rise sharply during the next five years. However, Beer drinking in China is still very much an urban pursuit and per capita consumption remains relatively low. The leading international brewers have recognised this and are already primed to exploit the enormous future potential.

Discounts rising in the East and South…

East Europe is a hugely important market and has expanded by some 47% since 1999. East Europe is also home to three of the fastest growing nations by volume, namely Russia, the Ukraine and Poland.

In Russia, Discount Beers have captured the attention of the leading brewers and the segment’s popularity is increasing along with volume and share of throat. September saw the introduction of restrictions on the advertising of Beer though and the effects of this move remain to be seen. The Ukraine is somewhat smaller than Russia but has delivered very encouraging double digit growth in six of the last seven years.

Central and South America has recovered strongly from the downturn in 2003. Volumes grew in Brazil last year and further progress is expected to be made during 2005. Brazil’s strong Beer culture combined with favourable weather and demographics provide a sound platform for success. The Discount Beer segment again performed positively thanks to independent regional brands. Elsewhere, the Middle East and Africa are emerging rapidly.
Consolidation continues as brewers think global…

Also available from Canadean is “The Global Brewer Handbook 2005”. This report confirms the continued consolidation in the industry, a notable example of which has been the merger of Interbrew and AmBev to create InBev. The new Company has since strengthened its position in China with the purchase of Lion Malaysia Group’s Beer interests, taken full control of Sun Interbrew and acquired the Russian brewer Tinkoff. During 2004 and 2005, SABMiller preferred to focus on organic growth. Nevertheless, the Company still managed to complete it’s largest ever acquisition, purchasing giant South American brewer Grupo Empresarial Bavaria in September.

The prolonged period of mergers and acquisitions has forced the major players to focus on business integration and restructuring. In the Spring of 2005, Heineken announced five new operating divisions whilst Carlsberg ended its relationship with Orkla to become the sole shareholder of Carlsberg Breweries.

The trend towards consolidation is underlined by the fact that the top ten brewers now account for almost 52% of global Beer consumption, compared with just 23% six years ago. Furthermore, the strategies of these major players are more international than ever as they seek to take advantage of opportunities across the globe. In 1999, they generated around 33% of their turnover from overseas sales. Today, the figure is approaching 62%!

“Global Beer Trends 2005” from Canadean’s Beer Service provides 150 pages of valuable market data analysing consumption for each major region from 1999-2010. Useful summary sheets are also provided for over 50 countries. “The Global Brewer Handbook 2005” provides 44 pages of analysis by brand, brewer and region. Company profiles examine the sales, structures and strategies of 25 leading brewers.

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