The Netherlands: Heineken N.V. profit forecast for 2006 slightly above 10%

Heineken N.V. announced July 18 that it has raised its forecast for organic net profit growth for the full year ending 31 December 2006. Heineken now expects that organic net profit growth for the full year will be slightly above 10%. On 22 February 2006 Heineken announced that organic net profit growth in 2006 was not expected to exceed mid-single digits.

Strong volume growth in Central and Eastern Europe, the Americas, Africa and Southeast Asia has driven revenues and profit growth of the Heineken Group and resulted in the increase of the net profit forecast. In particular the launch of Heineken Premium Light® in the USA is proceeding successfully. Although the launch is still in its initial phase, volumes are expected to exceed the previously announced 400,000-hectolitre target for 2006. The introduction also has a positive effect on the volume growth of the core Heineken® brand in the USA.
In Russia the integration activities related to the breweries acquired in 2005 are proceeding at pace and beer volumes are developing well.

The premium beer segment continues to grow faster than the world beer market overall. The Heineken® brand is growing at a faster pace than the premium segment itself. ... More Info

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Kazakhstan: Beer market saw imports increased by 25% in the past 5 years

Kazakhstan beer market is estimated at KZT 60-67 billion (near US$590 million). The market growth rate was 25-30% during the last 5 years. The current year is said to preserve the same increasing trend. Even if the first trimester of the year is traditionally not very prolific for beer sales, the market increased during the first 4 months of 2006 by one third year-on-year, The Union of Russian Brewers said July 17.

There are presently 80 functional breweries in Kazakhstan. The domestic market leaders are “Shimkentpivo”, “Effes-Karaganda” and its Alma-Ata affiliate “Debres Brewing Company”, JSC “Rosa” (Pavlodar), “Dinal” (Heineken). In addition, large international brewing companies like Baltic Beverages Holding (BBH) and SUN Interbrew are the ruling beer importers in Kazakhstan. Leader breweries hold a 90% share of overall Kazakhstan beer production and shipments. Ten leading local brands (Baltika, Derbes, Irbis, Karagandiskoe, Klinskoe, Tian-Shan, Pavlodarskoe, 130, Shimkentskoe and Alma-Ata) account for 80% of the national beer sales.

Erzmann Brewery analysts estimated imports are generally to increase. In 2001, the market share of the imported beer was over 2%. This year forecasts say this figure may reach 19% and almost 26% in the year ahead.

Experts believe the market is suffering from a deficit of ... More Info

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Mexico: Grupo Modelo 2Q export volume increased over 7%

Top Mexican brewer Modelo saw second-quarter export volume growth of between 7 percent and 8 percent over the same period a year earlier, Reuters said July 14. Modelo, the maker of Corona beer, forecasts that domestic beer volume growth for the April-June period would come in between 5 percent and 6 percent, analysts at the brokerages said.

Spokesmen at Modelo were not immediately available to confirm the sales forecast that company officials gave to brokerages.

Export growth, mainly to the United States, has been outstripping domestic growth for the last few years. Modelo, half-owned by giant U.S. brewer Anheuser-Busch Cos. Inc., also told analysts to expect margin expansion in the second quarter.

Shares of Modelo were down 1.43 percent on Friday at 42.00 pesos in a broad market sell-off. The key Mexican stock exchange index was off 1.16 percent. Modelo is scheduled to report its full second-quarter earnings results on or before July 28.

Founded in 1925, Grupo Modelo® is the leader in the production, distribution, and sale of beer in Mexico. It has seven breweries in Mexico, with an installed capacity of 46 million hectoliters of beer per year.

At present it has ten brands, among them Corona Extra®, "the best selling ... More Info

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Germany & Russia: A bankruptcy procedure concerning Friedrich Weissheimer Malzfabrik KG has been filed on July 5

Bank Avangard herewith informs interested parties that on Wednesday July 5, 2006, an application to open a bankruptcy procedure concerning Friedrich Weissheimer Malzfabrik KG has been filed.

As you may know end of March a provisional bankruptcy administrator had already once been installed. This proceeding was terminated end of May. Such termination was based on several commitments of Bank Avangard and on corresponding obligations of Friedrich Weissheimer Malzfabrik KG. These obligations contained, in particular, arranging all company turnover through a specific and agreed bank account under mutual control, mutual acceptance of all sale and purchase contracts, etc.

While Bank Avangard met its commitments, unfortunately the Friedrich Weissheimer Malzfabrik KG management has not fulfilled its obligations. Receivables were spent out of mutual control for purposes, which were not accepted or not even disclosed. Fresh money granted by Bank Avangard was spent and lost, that was the reason for Bank Avangard to claim payment of receivables by debtors to a special account. As it appeared, most of the receivables were sold by Friedrich Weissheimer Malzfabrik KG management to a third party under a factoring agreement not disclosed to Bank Avangard, and money received from the factor was spent again out of ... More Info

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EU: European Commissions forecasts winter barley crop to increase by 2.3% despite drought across Europe

This year's total EU cereal harvest remains in line with the last five years, though droughts continue to put pressure on prices, Food Navigator released July 17.

Once again, drought is keeping crop yields at low levels in southern Europe (Spain, Portugal, France, Italy and Greece).

But overall, detailed scientific analysis by the European Commission's advanced crop yield forecasting system suggests that cereal production, for the moment, remains stable.

The forecast published July 14 by the Commission provided yield estimates for the main crops throughout the European Union, comparing these with last year's production and the average harvests over the last five years. It also identified the areas most affected by drought this year and compared the situation with past extreme drought events.

The report follows a recent FAO study, which suggested that world cereal demand is likely to surpass supply in the coming 2006/07 marketing year, pushing down stocks to an uncomfortably low level, according to the FAO.

This will continue the steady upward trend in prices. Indeed, wheat prices are likely to remain generally high and volatile in the new season, the FAO said.

The EC report suggests that EU crop yield levels are suffering this year from similar ... More Info

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World: Hop producing countries in the Northern Hemisphere are enjoying ideal weather for hop production

July 2006 Hop Report
By Douglas MacKinnon

Growers in nearly every hop producing country in the Northern Hemisphere are enjoying ideal weather for hop production. Hop producing countries south of the Alps such as Slovenia and Bulgaria have had unusually hot summers thus far with little rain causing plant stress and grower concern. While there are some isolated problems in one or two varieties, on the whole in Europe and America, it is shaping up to be a good year in the hop yards with little or no serious trouble from pests or diseases.

Across the Atlantic in America, short supply of aroma varieties has led to good prices for those who still have hops left to sell. Alpha hop prices have also strengthened, and will likely continue to do so through the summer, as acreage reduction in the past several years has brought supply more in line with demand, a situation that favors growers.

The weak dollar persists to the delight of American exporters. With no sign of strengthening on the horizon, American hops are selling at better prices and at lower prices than their European counterparts. This trend has brought two things the American hop industry has not seen for quite some time, profit and forward contracts. Profits from 2006 are not likely to lead to speculative planting of hops in upcoming years because recovering from the losses of previous years is a priority for most growers. This means we can expect the current equilibrium between supply and demand to survive several seasons.

It is bloom time in the hop yards. Bloom is a critical time for hop growers. It is a time when the plants are most vulnerable to the nemesis of every hop grower, powdery mildew. Every hop bloom has the potential to turn into a hop cone. When infected with powdery mildew, cones do not develop or are light and therefore do not end up in the bale. Needless to say, this is a tense time for most hop growers but less tense than in previous years. If the current weather trends continue and problems with pests and disease stay low during the month of July, the biggest challenge many growers will face is where to sell any hops that may remain once their contracts are filled.

Douglas MacKinnon is chairman of the International Hop Growers Convention executive committee. He publishes the MacKinnon Report, a subscription newsletter that reports developments and market activity within the hop industry. For subscription information please contact Doug at
doug@mackinnonreport.com

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ABSTRACT: This study evaluates the influence of biological mash and wort acidification using a thermophilic proteolytic/amylolytic active Lactobacillus amylovorus on brews containing 20% (wt/wt) unmalted barley in laboratory-scale trials as well as 10-hL pilot-scale brews. The biologically acidified mash was compared with a chemically acidified mash, 100% malt mash unacidified, and 80% malt (wt/wt)/20% (wt/wt) barley unacidified mash. Characteristics such as pH, extract, color, viscosity, total soluble nitrogen (TSN), free amino nitrogen (FAN), apparent fermentability, ß-glucan, sugar, and amino acid profiles of the resultant worts were determined. In the pilot-scale brews, foam stability, accelerated shelf life, and sensory evaluation of the beer was determined. It was clearly shown that biological acidification (BA) could compensate for a lower enzymatic activity level of grists containing 20% (wt/wt) barley. Increased levels of extract, fermentability, TSN, and FAN were observed in the laboratory-mash trials along with a sharp decrease in ß-glucan levels when BA was applied. Cast-out wort showed a considerable increase in nitrogenous fractions. Viscosity was decreased by acidification of mashes but did not correlate with ß-glucan levels. The final biologically acidified beer showed a lighter color, improved foam stability, and a more well-rounded taste with increased shelf life in comparison with the chemically and the nonacidified beer.
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