Kirin Brewery shares closed higher than those of rival Asahi Breweries for the first time in 27 months on the Tokyo Stock Exchange on Wednesday, January 25, according to Asia Pulse/Nikkei.

Speculation that Kirin Brewery could take back the title of market leader for beer shipments from Asahi Breweries this year boosted the beer maker's stock price.

Kirin, Japan's second largest brewer, finished at 1,424 yen (US$12.32), down 16 yen on the previous day, compared with a 41-yen tumble to 1,421 yen for Asahi Breweries.

Since summer, Kirin stock has been on an upward trend. Thanks to strong sales of its third beer, Nodogoshi Nama, it is likely to post a record group operating profit for the fiscal year through December 2005, widening the gap in earnings with Asahi and Sapporo Holdings.

But the company "that will benefit from the economic turnaround will be Asahi, whose strength lies in selling beers at restaurants", pointed out Tokushi Yamazaki, analyst at Daiwa Institute of Research.

It remains unclear if Kirin's stock price will continue to rise largely because its price-earnings ratio is 27, which is considerably higher than Asahi's 17.

Analysts at ING Financial Markets maintain their "buy" rating on InBev, while raising their estimates for the company. The 12-month target price has been raised from EUR 37.20 to EUR 43.00, ING Financial Markets posted on January 25.

In a research note published this morning, the analysts mention that the company has agreed to acquire Fujian Sedrin for EUR 614 million. Fujian Sedrin holds a leading market position in the Fujian and Jiangxi provinces, the analysts say. InBev expects EUR95 million in cost synergies and EUR 15 million in sales synergies from the acquisition, ING Financial Markets adds.

The EPS estimates for FY2006 and FY2007 have been raised from EUR2.08 to EUR2.18 and from EUR 2.42 to EUR 2.53, respectively.

In 2006 Russia’s largest beer maker, Baltika, plans to increase its beer sales and to extend distribution in China. The company plans to start shipments to Shanghai, Hong Kong and other provinces in Central and Southern China. At the moment negotiations are carried on with the potential distributors. Today Baltika is the only Russian beer exporter to China.

A government delegation of Shanghai on its visit in St. Petersburg has visited Baltika brewery. The leaders have highly appreciated the quality of Baltika beer.

Baltika has started to export its production to Chinese market in September 2004. According to 2005 figures, Baltika exported about 600 thousand conventional bottles of beer to China (cans of 5l, bottles of 0.33l and bottles of 0.5l). In 2006 Baltika plans to export about 1.5 mln bottles.

Per capita beer consumption in China is about 22 litres per year compared to 59 litres in Russia.

In the Chinese beer market Baltika beer is positioned on the “superpremium” segment and is distributed mainly in restaurants and pubs.

International Grains Council (IGC) published on January 26 its estimated total barley production for 2005/2006 at 137 million tonnes, 2 million tonnes up from previous IGC’s estimation. The main increase was in Australia, where rains benefited yields.

Forecast consumption in 2005/06 is also higher than before, at 143 million tonnes, following increases in non-feed use in several countries.

World barley trade is forecast at 17.3 million tonnes, slightly less than in November. Iran may import more feed barley than previously projected, but Russia’s malting barley imports are smaller. IGC commented: “In the barley market, trading was relatively subdued, with Black Sea export quotations drifting a little lower in the face of competition from EU intervention sales and new supplies entering markets from Australia.”

Stocks at the end of 2005/06 are put at 21.9 million tonnes, 0.2 million tonnes more than previously forecast, but 5 million tonnes less than a year earlier, with big reductions in the EU and Russia.

According to IGC main barley market events since 24 November 2005 are as follows:

On December 14, 2005 Jordan bought 100,000 tonnes of feed barley (plus 100,000 tonnes on 18 January 2006). On January 13 Tunisia bought 75,000 tonnes of barley.