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• USA: The chairman of Boston Beer Co. wants to increase sales of the company’s Samuel Adams beer by 6% a year ...more info



• Peru: Country’s leading brewer, Union de Cervecerias Peruanas Backus & Johnston, or Backus, has reported fourth-quarter net income of PEN67.9m (US$19.56m) ...more info



• Japan: Asahi Breweries Ltd, Japan's top beer maker, reported on February 20 a 57.3 % rise in net profit in 2003 as cost cuts more than offset sluggish sales ...more info



• Two of Japan's top brewers, Asahi Breweries Ltd and Sapporo Holdings Ltd said on February 20 profits surged in 2003 as cost cuts offset a slump in domestic beer sales ...more info



• Hong King: The board of directors of Guangdong Brewery Holdings Limited confirmed that on 19 February 2004, the Company issued 133,768,000 New Shares to Heineken APB ...more info



• Denmark: The Board of Directors of Carlsberg A/S approved on February 19 that the annual report of the Carlsberg Group and the Parent Company for 2003 be presented ...more info



• Budejovicky Budvar and Anheuser-Busch have long argued over which brewer has the right to market 'Budweiser' beer ...more info



• Chile: With ratings unaffected, Compania Cervecerias Unidas S.A. maintained an adequate financial profile for its rating category despite the increased leverage in second-quarter 2003 ...more info



• Canada: Labatt Brewery has branched into print advertising pointing out that Carlsberg beer is no longer being brewed by Labatt ...more info



• Efes Breweries International NV, the Netherlands-based unit of Turkey's Anadolu Efes has hired Credit Suisse First Boston (CSFB) to lead its initial public offering ...more info

Brewery News

Denmark: Carlsberg A/S (“Carlsberg”) announced on February 17 that it has signed an agreement to buy Orkla ASA's 40% shareholding in Carlsberg Breweries A/S (“Carlsberg Breweries”) for a total of approximately DKK 14.8 billion (the “Transaction”). On completion of the Transaction, the partnership between Carlsberg and Orkla ASA (“Orkla”) will end and Carlsberg will be the sole shareholder of Carlsberg Breweries. Completion of the Transaction is anticipated to occur no later than mid March 2004. The Transaction is the largest single investment undertaken by Carlsberg to date and Carlsberg believes it will create significant shareholder value and improve the structure of the Carlsberg Group. The Transaction will ensure that shareholders of Carlsberg have complete ownership over their largest operational asset – Carlsberg Breweries; will provide shareholders with a more direct access to operational cash flows; will be immediately earnings enhancing (prior to the amortisation of goodwill); will enhance transparency and corporate governance for all Carlsberg shareholders across the Carlsberg Group; and will ensure best position Carlsberg Breweries to further its earnings and volume growth with a single shareholder, focussed upon the brewing industry...more info

Mexico: Grupo Modelo, the No. 1 brewer in Mexico and maker of popular Corona beer, said on February 18 its fourth-quarter net profit rose 31.5 % amid vigorous export growth, mainly to the United States. Modelo, 50 % owned by the world's top brewer Anheuser Busch Cos. Inc., beat analysts' expectations as the bottom line came in at 1.114 billion pesos ($99 million), up from 847 million pesos in the October-December period of 2002, Reuters revealed. A previous Reuters survey of analysts had forecast a net profit of 1.016 billion pesos for Modelo, which also brews Pacifico, Negra Modelo and Victoria beers. Modelo's shares surged on the Mexican bourse on Wednesday, closing up 4.70 % at 29.61 pesos, a 10-year high and one of the top 10 gainers. Its shares are up around 10 % this year, lagging a 15 % rise in the bourse's key index. Shares for Modelo's rival Femsa, due to report its fourth-quarter results next week, fell 0.51 percent to 48.77 pesos, Reuters said. Exports for Modelo, which sells five beers abroad in 150 countries with 90 % going to the United States, drove operations all last year and far outstripped growth in domestic sales, which have been tough amid an insipid economy. Modelo said export volumes soared 19.7 % in the quarter while domestic sales volumes, after showing several meager months, moved up 6.3 %, with strong pre-Christmas demand in December. Modelo said the year-on-year export jump was from more beer sales in the United States and also inventory buildup by distributors because Modelo told them it would jack up prices for its Corona and Corona Light beers from January 1...more info

Bosnia: Europe's largest brewers head the list of eight companies that have applied for a majority stake in Bosnia's biggest brewery, Banjalucka Pivara, its general manager said on February 18. "The most serious bidders are Dutch Heineken, Belgian Interbrew, Denmark's Carlsberg Breweries A/S and Slovenia's Pivovarna Lasko," Predrag Radic told Reuters. Radic said London-based SABMiller Plc, the world's second-largest brewer behind Anheuser-Busch Cos. Inc. of the United States, has also expressed interest in buying a 53.81 % stake in the Banjalucka brewery. Two Austrian brewers and an individual representing a group of investors are also interested, he said. The privatisation tender was opened last month and runs until March 10. It did not specify the price for the stake in the only brewery in Bosnia's Serb Republic but its government had earlier put the value at 43 million Bosnian marka ($28.3 million). The government is seeking a strategic investor who is in the beer business for 10 years to continue production and invest in the company's development. The bidders need to have an annual revenue of at least 100 million marka. Radic said that Interbrew, which is vying for the stake in Banjalucka for the second time in the last four years, has had "the best acquisitions" in the region after having acquired the biggest brewery in the Balkans and three others...more info

Japan: Kirin Brewery Co, Japan's No.2 beer maker, said on February 18 its net profit levelled off in the 2003 business year after asset write-downs and other reforms, but it sees profit jumping 32 percent in 2004. Japanese brewers, faced with shrinking beer and low-malt "happoshu" markets at home, are pushing structural reforms and diversification of their revenue base. "The contraction of the markets is expected to continue into 2004, but at least the makers have given up cutthroat price competition and the worst (for the industry) may be over," said Naomi Takagi, an analyst at HSBC. Kirin, which also produces beer in China and Australia through joint ventures, posted 32.40 billion yen ($304 million) in net profit in the year ended in December, down 0.4 percent from 2002. Revenues rose 0.9 percent to 1.6 trillion yen. "The structural reforms implemented in the past few years are beginning to take effect. We see 2004 as the start of a new growth era," Managing Director Yoshikazu Arai told a news conference. The results were well-flagged as the company earlier this month said it expected to book a group net profit of around 32.5 billion yen on revenue of 1.6 trillion yen for 2003. Kirin expects net profit to zoom to 43 billion yen in 2004, on sales of a record 1.7 trillion yen. The expected improvement in profit is seen mainly due to the absence of the 20.9 billion yen special loss it booked in 2003 to cover the costs of structural reforms including those at parent Kirin Brewery and unit Kirin Beverage Corp...more info

USA: Anheuser-Busch has considerable competitive advantages that enable the company to meet challenges, while continuing to achieve its financial objectives, company executives told investors and analysts at the Consumer Analyst Group of New York Conference on February 19. The company achieved significant growth in market share and revenue per barrel, and recorded a 12.7 percent increase in earnings per share in 2003. “Anheuser-Busch has a long track record of adjusting to changing conditions and successfully meeting challenges,” Patrick Stokes, president and chief executive officer, Anheuser-Busch Cos., Inc., told the investors. “We have substantial competitive advantages that we continue to enhance and the proven ability to leverage these strengths to achieve consistently strong results.” Addressing industry fundamentals, Stokes reported that the pricing environment in the U.S. beer market remains very favorable with 2003 marking the 10 th straight year of consumers trading up to premium and above beer brands. Anheuser-Busch, in turn, has achieved 21 consecutive quarters of revenue per barrel increases of 2 percent or more on a year-over-year basis. “In addition, while a number of short-term factors negatively impacted industry volume in 2003, our outlook for industry volume growth remains positive,” Stokes added. The company's wholesaler sales-to-retailers showed significant improvement in the second half of 2003 vs. the first half, and this improvement in volume growth has carried over into 2004...more info

Malt News

Australian marketer ABB Grain Ltd. said on February 19 that merger talks with malting and logistics concern AusBulk Ltd. are continuing, but no agreement has yet been reached, Dow Jones revealed. It isn't certain a merger agreement will be reached, however, ABB Grains said. "ABB directors believe that there is considerable merit in bringing the two companies together to create a unified and fully integrated grain business, provided that is in the interests of ABB and all ABB shareholders," the company said in a statement. John Murray, AusBulk's managing director, had said on December 15 that ABB Grain would be a natural fit for the company. "The two companies fairly well complement each other in their core businesses" and their shareholders, he said then. Both ABB Grain, which markets barley and other grains, and AusBulk are based in South Australia state. The two companies are well into merger talks, and at the forefront of the ACCC's interest is the stranglehold a merged entity would have in the barley/maltster market, Australian The Age news revealed on February 20. ABB is the leading collector and marketer in south-east Australia of barley, the raw material for malt, while AusBulk is the largest maltster in Australia and controls the SA market. Only Western Australia's Co-operative Bulk Handling, with more than 20 per cent of the national barley market, is a rival...more info

Barley News

Canada: For 2003-04, barley exports in Canada are forecast by Agriculture and Agri-Food Canada (AAFC) at 2.8 million metric tonnes, versus 0.9 million metric tonnes in 2002-03, according to a report published on February 13. Carry-out stocks are forecast to increase by 18%, to 1.7 Mt. For 2004-05, barley production in Canada is forecast to increase by 8%, as higher yields more than offset lower area. Total supplies are expected to rise to 15.0 million metric tonnes from 13.8 million metric tonnes in 2003-04. Domestic use is forecast to increase by 11% due to increased feed demand. Exports are projected to decline slightly, to 2.75 million metric tonnes. Carry-out stocks are expected to rise to 1.9 million metric tonnes from 1.7 million metric tonnes for 2003-04. Off-Board feed barley prices are forecast at $125/t, the same as for 2003-04. The CWB 2004-05 pool returns for No.1 CW Feed barley are forecast by AAFC at $150/t, I/S VC/SL, versus the Jan. 2003-04 PRO of $158/t. CWB pool returns for Special Select Two Row designated barley are forecast at $190/t, versus the Jan. 2003-04 PRO of $197/t, as a result of increased world barley supplies.

Eastern Europe: Winter has been fairly mild so far, and crop prospects are much better than a year ago. The official barley 2003 crop estimate of Russia is 17.946 million tonnes, a huge increase from earlier estimates versus 15.5 million tonnes by USDA/IGC. Export forecasts for the crop year are 3.5 million tonnes for Russia and 1.15 million tonnes for the Ukraine. Earlier estimates that Russia will import 400,000 tonnes of malting barley have become doubtful in view of the very firm EU markets and Euro currency.

Theoretical malt prices.

* - 70/30 = 70% Average two Rows Spring and 30% Six Rows Winter
** - 50/50 = 50% Average two Rows Spring and 50% Six Rows Winter

Theoretical malt prices for crop 2004 are available on site www.e-malt.com/MarketPrices

Malting barley prices. French barley prices. Nominal prices.

EURO = USD 1.2709 February 20, 2004
Crop year		2003		2004
Parity		FOB Creil		FOB Creil
Position		July 2003		July 2004
Type	Variety	EURO	USD	EURO	USD
2RS	Scarlett	137.50	175.00	134.00	170.50
2RS	Prestige/Cellar	137.00	174.50	133.00	169.50
2RS	Aspen	135.00	171.50	132.00	168.00
2RS	Optic	135.00	171.50	132.00	168.00
2RS	Astoria	135.00	171.50	131.00	166.50
2RS	Cork	134.00	170.50	131.00	166.50
6RW	Esterel	133.50	170.00	123.00	156.50

nq - Not quoted

Prices for Danish and UK malting barley are available on site www.e-malt.com/MarketPrices

Graph of the week

Agenda

February 2004: Pianeta Birra - Beverage & Co. International Show of Beers, Beverages; Orges brassicoles 2004: Des perspectives nouvelles de marchés; HOFEX 2004 Food & Drink; Canadian Food & Beverage Show; BIEREXPO; GrainWorld 2004;
March 2004: New York City Real Beer Festival; Real Ale Festival; The Night of Large Thirst; Zythos Beer Festival; International course - Malting and Brewing Science; FOODEX Japan 2004; ANTAD 2004; 2004 BIENNIAL CONVENTION; Beer Auction 2004, the international exhibition of beer, technology and equipment; China Drinktec 2004. China International Exhibition on Beverage and Brewing Processing Technology
April 2004: World Beer Cup; 2004 National Craft Brewers Conference and trade show BrewExpo America;

More events are available on site e-malt.com

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