Report breaks down slowing global beer market

Beverage research agency Canadean published fresh figures this week showing a drop in beer volume growth from a respectable 6 per cent in 2007 to less than 2 per cent in 2008.

Sales are predicted to slow further in 2009 as the fallout from the global economic slowdown plays itself out in the beer market.

Europe and North America are putting the biggest drag on global sales growth. Together the two regions represent 45 per cent of the global market and neither is looking in particularly good shape.

European decline​

Canadean said Western Europe has not seen growth since 2006 and the economic crisis has only accelerated the downward trend. Ironically it has been economic development in the region that is also in some ways responsible for the longer term decline in the beer market.

Canadean analyst Kevin Baker said: “Beer drinking has been allied to heavy industry in the UK and Germany with breweries generally found close to mines and factories.” ​Heavy industry has declined in these countries and has taken heavy after-work drinking sessions down with it.

In neighbouring Eastern Europe, which had been an enclave of growth, the research firm said the crisis is set to trigger a negative performance this year.

Russia, for example, had been a strong emerging market until it declined for the first time last year and sales are expected to deteriorate further this year.

Meanwhile, North America is performing slightly better than Europe after having been on largely the same growth path up until 2006. But, even there growth has fizzled out to almost nothing, according to Canadean.

Emerging market growth​

Despite the gloomy picture in these core markets, growth is still robust in the emerging markets of Asia and Latin America.

Asia is becoming a significant region in the global market, accounting now for about a third of global beer sales. In 2008, sales growth slowed slightly but remained strong at 5 per cent as Chinese consumers, who drink about 7 in every 10 litres of beer sold in Asia, continued to spend more on beer.

This year China is expected to up its contribution to the global beer market. Baker said China is on track to account for almost 100 per cent of world growth in 2009.

In Latin America sales were also on the rise in 2009 with volumes increasing 3 per cent last year. Growth was fed by a 4 per cent volume increase in Brazil which is the fourth biggest beer producer in the world.

In 2009 Latin America and China may struggle to push the global market far above zero growth Canadean expects world figures to pick up again in 2010. Baker said even in Europe beer consumption is not falling off the edge of a cliff and some market niches like real ale in the UK are booming.