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02 July, 2020



Brewing news World: Beer category may rebound better than wine and spirits from the pandemic

Drinks market analysts, IWSR, has predicted that the beer category may rebound better than wine and spirits from the COVID-19 pandemic, The Shout reported on July 3.

Globally, beer (not including flavoured malt beverages, such as hard seltzers) grew 0.3 per cent in volume and +2.2 per cent in value in 2019, led particularly by increases in non-alcoholic beer (+15.2 per cent in volume, vs. 2018).

Though the beer category has taken a hit in 2020, in total, beer is expected to reach 2019 volumes by 2024, rebounding better than wine and spirits.

IWSR has highlighted five key factors which will influence the category’s resilience in recovery.

Investment in developing markets will yield dividends

Developed beer markets have stagnated in recent years and the major global brewers were already investing heavily in their brewing capacity and sales channels in developing markets pre-COVID.

The IWSR said that Africa has been a particular focal point for investment, and the IWSR expect beer sales to rise by 11 per cent on 2019 levels by 2024.

Additionally Heineken and Carlsberg have been active in Asia, in particular in Vietnam and Cambodia and IWSR project these two countries to be in the top 10 growth markets between 2019 and 2024.

India is also a market that is being viewed as having the potential for growth by major brewers. AB InBev announced major investments in India last year and IWSR predicts India’s beer consumption will rise by five per cent in the next five years.

Non-alcoholic beer will continue to grow

ISWR said: “Until relatively recently, no-alcohol beer was often seen as a distress purchase, but improving taste, innovation, substantial marketing support and widening availability, helped sales to jump by 15 per cent globally last year. The segment is a good fit with the contemporary consumer, and is predicted to expand by nearly 50 per cent over the next five years.

“An increasingly health-conscious consumer is being catered for by a growing range of products that provide a genuine alternative to full strength products. This will mean that drinkers wanting to abstain from alcoholic drinks do not need to leave the sector altogether, but can continue to drink beer.”

Craft brewers will re-emerge

This is good news for the Australian beer market, which has seen huge growth in craft beer over the last 10 years. IWSR highlights that this craft while this craft revolution has helped raise the profile of beer, the reliance of many brewers on the on-premise has left them particularly susceptible to the impact of COVID-19.

But in positive news for craft brewers, IWSR said: “The consumer’s appetite to explore and experiment is unlikely to diminish post Covid-19, and when the green shoots of recovery do emerge, we can expect a new generation of craft players to appear as well, replacing those that did not make it through. These new-age craft players will play an important role in the rehabilitation of the global beer sector.”

Ecommerce will provide a lifeline

The potential of ecommerce to provide a lifeline for brewers is something that has been highlighted recently by National Liquor News with its stories about Carlton & United Breweries.

Even before Covid-19, ecommerce value sales of beer increased by 13 per cent globally in 2019 and shopping habits during lockdown have seen online shopping increase for more and more consumers.

IWSR says: “We will likely see a surge in volumes through this channel in 2020. As an antidote to the pandemic, players in the industry are revamping their online capabilities, upgrading their online shops and partnering with digital sales platforms.

“This will help to offset any sluggish recovery of the on-trade channel and allow the sector to reach out to increasingly more drinkers.”

Women will drink more beer

The IWSR said: “A notable bias towards men continues to exist among beer drinkers. However, in recent times, helped in part by the craft movement, the sector has become a broad church of tastes, styles and flavours.

“As a result, beer’s appeal has increased to a wider, and often more female, audience. Added to this, the lower ABV level of beer could resonate with women looking to migrate from stronger alternatives like wine and spirits. Marketing and glassware should help to facilitate this as well.”





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