Carlsberg, the Denmark-based world’s fourth-largest brewer, said it managed to increase profit and gain market share in Eastern Europe and Asia in its interim first quarter results posted on May, 6.

The company said its Q1 performance was in line with management’s expectations.

Carlsberg’s beer volumes increased by 34% to 22.6 mln hl for the quarter (16.8 mln hl in Q1 2008). Organic beer volume declined by 5% while acquisitions contributed 39%.

In Q1, Carlsberg accelerated the efforts of mitigating the impact from the challenging trading environment through internal measures. Throughout the Group there has been an intense focus on strong execution and cost control with the aim of protecting earnings and improving cash flow during 2009.

In Eastern Europe execution of these efficiency improvements had a direct positive effect in Q1 resulting in strong organic operating profit growth of 66% (+40% in DKK). The initiatives in Northern & Western Europe have been executed as well and benefits from these initiatives will come through gradually over the year.

Likewise, the efforts across the whole Group to increase cash flow in 2009 are on-track. These measures include the improved operational performance coupled with lower capital investments and improved working capital management, the company ...More Info

SABMiller plc and Molson Coors Brewing Company reported on May, 5 increased profits for their joint venture MillerCoors on a pro forma basis for the quarter ended March 31, 2009, despite continuing commodity cost pressures.

"We delivered growth on five of our six focus brands, and we increased profitability through strong pricing growth and reduced price promotions," said MillerCoors Chief Executive Officer Leo Kiely. "These results demonstrate the strength of the MillerCoors portfolio in the face of a challenging economy and intense competition."

The brewer’s underlying net income, excl. special items, increased by 46.3% to US$216.4 mln in the first quarter of the current year. IFRS Underlying EBITA increased by 52.6%, whereas total net sales increased 3.8% to $1.716 billion. MillerCoors’ domestic revenue per barrel increased by 5.6%, and cost of goods sold (COGS) per barrel increased by 5.3%.

Excluding contract brewing and company-owned distributor sales, net sales increased 4.5 percent to $1.609 billion. Third-party contract brewing volumes declined 10 percent, though profits from contract brewing increased slightly.

The company reduced its marketing, general and administrative costs by 9.1% over the reporting period, driven in part by marketing expenditure timing and synergy delivery.

For the quarter, net income attributable to MillerCoors (excluding ...More Info

Molson Coors Brewing Company reported on May, 5 higher pro forma underlying income for the first quarter ending March 29, 2009.

Net income attributable to Molson Coors increased C$41.4 million, or 120.6 percent, to C$75.7 million for the first quarter.

Underlying after-tax income increased 75.3 percent to C$98.8 million, or C$0.53 per diluted share, up from C$56.4 million, or C$0.31 per diluted share a year ago. This strong earnings performance was driven by increased beer pricing and substantial cost reductions across the company, which more than offset continuing commodity inflation, unfavorable currency movements, and lower worldwide volume.

In the first quarter, foreign currency movements decreased total underlying pretax income C$8.7 million.

Excluding the impact of foreign currency, the Company’s underlying income increased approximately 89.4 percent in the quarter.

During the quarter, Molson Coors achieved an incremental C$18 million of cost savings as part of its three-year, C$250 million Resources for Growth (RFG) cost savings program. These cost savings include the company’s 42 percent share of RFG cost savings initiatives that were achieved by MillerCoors, which equalled C$3 million in the first quarter.

MillerCoors further accelerated synergy delivery timing, realizing C$50 million in the first quarter which captures some savings originally planned for delivery in the second ...More Info

Beer remains the most popular alcoholic drink in Belgium but consumption has been falling over the years in volume terms, a recent study by Euromonitor International indicates.

In particular, on-trade consumption has been declining over the years, while off-trade sales increased, even though not sufficiently to fully offset the effect of falling on-trade sales.

According to analysts, there are several partly interlinked trends behind this development: as in other Western European countries, the Belgian population is ageing, and thus less likely to go out drinking. In addition, GDP growth in real terms has been mediocre, with a negative effect on beer consumption. Finally, there is an overall trend towards more at-home consumption, which is also underlined by the various beer keg systems launched by nearly all the major players over the review period.

The 2008 overall volume growth rate was slightly less negative but roughly in line with the last five years’ trend. This can be explained by the progressively more challenging economic conditions throughout the year. Increased food price inflation during the first part of the year meant more pressure on consumers’ budgets. Belgium is a challenging market for the beer industry with a trend towards declining volumes and stabilised population growth. ...More Info

Tsingtao Brewery Co. denied a newspaper report that it plans to build its own plant in Taiwan, Bloomberg communicated on May, 5.

The Taipei-based Commercial Times, citing a weekend report by the Nanfang Daily newspaper, quoted Tsingtao spokesman Zhang Ruixiang as saying the company may set up a Taiwan brewery following the consensus reached on Chinese investments on the island.

"We have no plan to build our own plant in Taiwan", Zhang said in a phone interview. "We already have a beer venture through a collaboration in Taiwan and have a good relationship with our partner."

Mr. Zhang also denied having been interviewed by the Guangzhou, southern China-based Nanfang Daily.

China's government said last week it would end a ban on investments in Taiwan on May 1 following an agreement to open cross-border operations for financial-services companies, expand direct flights and cooperate in fighting crime.

Tsingtao in 2002 gave Taiwan's Sanyo Whisbih Group brewing technology and the use of its brand name for a venture able to make 100,000 metric tons of beer a year, Tsingtao said in a statement at the time. Tsingtao gets royalties, Zhang said, declining to say how much.

Tsingtao, based in the eastern Chinese city of Qingdao, may take as much ...More Info

Beer companies in Bulgaria capitalised on investments in production facilities, technology and new product development, and continued to penetrate the domestic market, Euromonitor said in a review published in February 2009.

Marketing was the main strategic tool in 2008 and Zagorka AD, Kamenitza AD and Carlsberg Bulgaria AD continued to allocate significant budgets to increase sales and gain share from rival companies.

The other key ingredients – hot summer weather, major sports events (the European football championship) and steady tourist flows – also contributed to the growth.

New product development was not as strong as in previous years, when the domestic premium lager segment quickly expanded in size as a result of newly initiated domestic production of international brands. In 2008, the main additions to product lines were flavoured beers. Carlsberg Bulgaria AD launched Tuborg Lemon and Kamenitza AD added a green lemon-flavoured beer to its core Beck’s brand. Another new product launch that reached the shelves in the 2008 summer was Kamenitza Lev. This is a non-flavoured lighter-style domestic premium lager. Overall new product development clearly indicates the potential of the domestic premium segment and the direction in which it is heading. The “fresh” citrus flavours and “light” styles are likely to ...More Info

Foster's Group Limited (Foster's) has agreed to purchase Fijian Holdings Limited's (FHL) 29.0% shareholding in Foster's Group Pacific Limited (FGPL) for F$13.26 per share, the Australian brewer announced on May, 1.

The transaction values FHL's shareholding at F$40 million and increases Foster's ownership interest in FGPL to 89.6%.

FGPL owns and operates breweries and distilleries in Fiji and Samoa, producing and distributing various brands including Fiji Bitter, Fiji Gold and Vailima. Foster's purchased its initial stake in December 1957 and currently holds 60.6% of the shares in FGPL.

FHL first approached Foster's regarding a potential sale of FHL's shareholding some time ago, the brewer said.

Whilst general business conditions in Fiji remain challenging, the transaction simplifies the future ownership arrangements of FGPL, an entity already controlled and consolidated within Foster's accounts. The transaction is earnings per share accretive but not considered material to Foster's.

"Increasing our level of ownership provides us with greater strategic alignment and flexibility with respect to ongoing investment and management of Foster's Pacific business, particularly through the current business climate", Foster's CEO, Ian Johnston said. "Over many years, Foster's has enjoyed supplying great products to the Fijian and Samoan communities and providing employment to more than 300 ...More Info

Argentina’s 2008 beer sales were boosted by an extremely hot fall (late March to late June) and winter (late June to late September), Euromonitor International posted in a recently updated research.

According to industry observers, during 2008, Argentina’s total beer sales grew 29% in current value terms, slightly above the 25% CAGR (Compound Annual Growth Rate)of the review period. The main reason for this performance is the fact that prices increased above inflation because of the raw materials hike.

Off-trade imported standard lager sales saw the largest growth as a consequence of Argentineans opting for higher quality beer and the introduction of Corona in 710ml bottle, which is 15% less expensive than the 325ml presentation in which Corona products were initially offered to the market. Being less expensive than the former bottle made the product more affordable to a wider consumer target and served to boost sales. Additionally the larger bottle was better adapted to Argentine tastes, as it was more appropriate for sharing.

Unit prices increased around 21%, mostly as a result of the influence of rising raw materials costs and salary increases in the range of 20%. Additionally, consumers’ preference for premium products and brands contributed to drive up unit prices.

Rising ...More Info

U.S. private equity firm Kohlberg Kravis Roberts & Co is finalizing an agreement to buy Anheuser-Busch InBev NV's South Korean brewer Oriental Brewery Co (OB) for about $1.8 billion, Reuters cited on May, 3 some sources familiar with the situation.

The acquisition would give KKR a foray into major South Korean assets, where lower valuations are attracting private equity houses.

According to an OB official, a deal is expected to be signed this week. Another unnamed source said the price of the deal was estimated at about $1.8 billion.

"Our knowledge is that an agreement will be signed with KKR either on May 6 or 7," the OB official said. "A group of KKR officials have recently toured OB plants," he added. He declined to be named because he was not authorized to speak to the media.

Selling unlisted OB would give the Belgium-based AB InBev around a $1 billion profit. The world's biggest brewer reportedly spent a combined 1.15 trillion won ($884 million) to secure full ownership of the No.2 beer maker in South Korea since 1998, when it first bought a stake.

AB InBev is looking to sell non-core assets and repay debt. It had valued OB at more than $2 billion, according ...More Info

SABMiller Plc, the world’s second- biggest brewer, plans to open its fourth factory in Tanzania by November, boosting beer production by 22 percent, Bloomberg reported on May, 6.

The facility, built at a cost of $55 million, will be able to produce 600,000 hectolitres of beer annually, Robin Goetzsche, managing director of Tanzania Breweries Ltd., said in an interview in the commercial capital, Dar es Salaam. The company has breweries in Dar es Salaam and the northern cities of Arusha and Mwanza that produced 3.25 million hectolitres last year.

“Our volume over the last few years has grown about 5 percent per annum,” said Goetzsche. “We expect continued growth, and with it further expansion.”

The economy of Tanzania, an East African nation of 41 million people, is expected to grow about 5 percent this year, compared with 7.5 percent last year. The country is Africa’s third-largest gold producer and derives about 40 percent of its gross domestic product from agriculture.

Tanzania Breweries is also spending about $24 million to upgrade its Arusha and Mwanza breweries and add a new 36,000- bottles-per-hour line at its main plant in Dar es Salaam by October, Goetzsche said. Last month, the company opened a 48,000-bottles-per-hour line ...More Info

For 2009-10, Canada’s barley producers intend to increase the seeded area marginally, switching away from higher input crops, to 3.84 mln ha, Agriculture and Agri-Food Canada reported on April, 30.

The nation’s barley production is expected to fall by 10% to on lower yields to 10.8 mln metric tons. Total supply is forecast to fall by 3% to 12.94 mln metric tons.

Domestic feed use is projected to decrease as livestock inventories continue to be liquidated.

Total exports are forecast to rise slightly to 2.4 mln tons as world supplies of barley are expected to tighten.

Carry-out stocks of barley are forecast to fall by 5% to 2.0 mln tonnes in 2009 - 2010.

The off-Board price of feed barley is forecast to decline slightly from 2008-09 under pressure from large feed grain supplies. The PRO for malting barley (Sel CW 2-Row) is C$248/t.

Opinions differ markedly on whether AU$9-9.50 a share is a fair offer for ABB, The Weekly Times Now reported on May, 6.

The real value of ABB is the most important question for the company’s shareholders in deciding whether to allow a takeover by Canadian business Viterra.

Last week, ABB announced to the Australian Stock Exchange that Viterra had made a non-binding offer of AU$9 to AU$9.50 for each ABB share, made up of a mix of cash, Viterra shares and franked dividends.

While ABB shares spiked at the news from about AU$6.20 to above AU$8.50, the shares were tracking at more than AU$10.50 in June last year.

Former Australian Barley Board deputy chairman and Berriwillock farmer Neil Simpson said the big question was if ABB was worth AU$8.50 in a drought, then what would it be worth in an average season?

"I think the real value is closer to AU$15 to AU$18," Mr Simpson said.

"But there are very few buyers in this climate and if anyone is looking, then they can it pick up cheaply."

Mr Simpson said the merger also raised the issue of which company would be the dominant one.

But he also said the takeover could bring advantages.

"If the world is drifting to ...More Info

The Canadian Wheat Board has added a feature on its website encouraging farmers to pay special attention to details of their malting barley contracts with grain companies.

While the CWB controls the sale and pricing of domestic and export malting barley, selection of the high-quality grain required for the process is managed by grain companies dealing directly with producers. Since malting barley is not a grade under the Canada Grain Act, the producer and company must agree on the quality specifications, and unlike official grades, disputes cannot be referred for a binding decision to the Canadian Grain Commission.

The CWB says producers should "Think B.E.E.R" — Be sure to get it in writing; Ensure your contract clearly defines all quality specs; Evaluate the risk of not meeting specifications and Retain samples (original and from time of delivery).

"Farmers have to be aware of what they are signing. You need to know the terms and conditions, and you should have all your bases covered and know your rights," Harold Frieze, a CWB Farm Business Representative in the Yorkton area says in an article on the website.

According to the CWB, three keys to helping prevent unwelcome surprises are to ensure you have the amount of ...More Info

The Barth-Haas Group, one of world’s leading hops suppliers, addressed its growers in a market report earlier this year.

The company said while it does not foresee a total collapse in beer consumption, as occurred in the car industry, it believes that the old adage ‘in bad times people drink more beer’ is not going to hold true either.

“What we can likely expect is stagnation in North America, a reduction in volume in Europe, particularly Eastern Europe, and a considerable slowdown in growth in Latin America and parts of Asia. All in all, the brewing industry will certainly sell less beer than they anticipated just last spring,” Barth-Haas said.

The US along with other hop producing countries have just invested heavily to meet the demand of a brewing industry that a year ago had no more hop inventories and enjoyed above average beer volume growth. Now, unfortunately, the growth period is over. While there are no large inventories yet, they could become a reality unless the future world hop supply is brought into balance with the new demand structure, the company affirms.

In a number of cases, breweries may have bought forward contracts with some growth in mind. Now that this growth will ...More Info

Barbara Foszczynska, Ewelina Dziuba, Regina Stempniewicz

Abstract:
ABSTRACT The influence of chemical disinfection of barley grain and addition of biomass of Geotrichum candidum in the process of steeping or germinating the grain on the enzymatic and technological quality of malt was examined. Rudzik brewing barley grain disinfected using formalin or biologically protected using G. candidum strains 1, KC3 and KB5, was used as experiment material. The starter cultures were added during steeping or at the beginning of germination. It was observed that the use of formalin negatively influenced the modification of malts and resulted in, among others, lowered Kolbach index (by 4.3% avg.). Addition of starter cultures to the first steeping water was favourable for the creation of enzymatic potential of malts. As compared to the control sample, starter malts were characterised by higher activity of beta-glucanase (by 24 U·kg^-1) and alpha-amylase (by 20 U·g^-1) and by higher diastatic power (by 20 WK-u). The best enzymatic a Key words: brewing barley, Geotrichum candidum yeasts, malting.. Load full article, 9 pages, 247 Kb, PDF file