Asian cheer boosts global beer

Relentless growth in Asia has helped the global beer market continue to grow despite radical decline in western Europe.

The economic troubles have, however, impacted beer volumes to the extent that global growth dropped from 6% in 2007 to less than 2% in 2008, according to Canadean, the beverage research agency.

Canadean’s recently published Global Beer Trends Report anticipates a further slowdown in 2009 before demand begins to accelerate again in 2010.

Asia now accounts for around a third of all beer sales and the region managed to record a 5% increase in volumes in 2008.

China, which accounts for seven in every 10 litres of beer sold in the region, is the driving force behind the figures and is helping to sustain the overall worldwide beer market in the face of challenging conditions elsewhere.

China did in fact see a slowdown last year, which Canadean puts down to a combination of the financial downturn, snowstorms in January and February, earthquakes in May and comparatively cooler summer weather. But the market still expanded by 6% – helped in part by the success of last summer’s Beijing Olympics.

Latin America can also take some of the credit for facilitating the progress of the global beer market, with 2008 sales increasing by a healthy 3%.

Canadean said: “As with Asia, there is one market that is acting as a major stimulant; in Latin America’s case it is Brazil. The fourth biggest producer of beer in the world, Brazil enjoyed a 4% volume growth last year helped by competitive pricing and a vibrant off-premise market.”

Despite the strong performances of the Asian and Latin American markets, the title of fastest-growing market goes to the Middle East & North Africa, which saw double-digit growth over the past 12 months.

Yet one must be careful not to be misled, with religious and cultural factors combining to make total sales in the region relatively insignificant at less that 1% of global volumes. Consumers in the region drink just two litres each per capita – less than 10% of the world wide average – and as such the industry cannot rely on consumers in this part of the world to drive up sales.

Perhaps the biggest cause for concern for the industry comes in Europe. Western Europe has not seen growth since 2006 and has seen the economic downturn quicken the rate of decline, while in neighbouring East Europe the crisis is set to trigger a negative performance this year.

The strong Russian market saw its first decline in a decade last year with sales set to get even worse this year. Despite their problems it should be noted that Europe remains home to eight of the top ten per capita drinking markets in the world, with the Czechs continuing to dominate, with each drinker consuming more than 160 litres annually.

Of equal concern is the pattern emerging in the influential North American market, where sales growth has fizzled out to almost nothing. Between them North America and Europe make up 45% of global beer volumes and with sales flattening in North America and European volumes falling, the focus is very much on Asia and Latin America to deliver volume growth during these turbulent times.

Alan Lodge, 14.10.2009