E-Malt.com Flash 18b. May 05

Russia: Heineken N.V. is acquiring 100% of Russian brewery Patra

Netherlands’ brewing giant, Heineken N.V., announced on May 6 that it has signed an agreement to acquire 100% of Patra brewery in Yekaterinburg, Russia.

The transaction will be funded from available cash resources and is subject to regulatory approval. The acquisition will be earnings enhancing in 2005 and is value enhancing in 2010. As agreed by both parties the acquisition price will not be published.

As a result of this transaction, Heineken's market share in Russia will grow to 8.3% from the current 7.5%, with volumes over 7 million hectolitres, further strengthening Heineken's number three position in the world's fifth largest and rapidly growing beer market.

Jean François van Boxmeer, member of the Executive Board of Heineken N.V. commented: "The acquisition of the Patra brewery fits perfectly in Heineken's strategy of selectively acquiring value creating assets in growth markets. In Russia, Heineken continues its purchases of regional breweries with the latest acquisition in the economically important Urals region. Furthermore, the Patra brewery will further strengthen our ever-expanding infrastructure."

The Patra brewery is based in the number three city in Russia,Yekaterinburg, situated in the fast growing Urals region, which accounts for 17% of the total beer market. Following this acquisition, Heineken will gain a strong number 1 position in Yekaterinburg, growing from a 11% market share to a combined market share of 31%. ...more info

France: French beer market is decreasing and Heineken France tries to stabilize its sales

French beer market has suffered an acceleration of its falling since the beginning of the year with 8% decrease of beer sales volumes...more info

Brazil: AmBev reports Q1 2005 financial results: Brazil beer sales increased by 12.9%

Companhia de Bebidas das Américas (AmBev), the leading brewer in Latin America, announced on May 4 its results for the first quarter 2005 (1Q05)...more info

Canada: Molson starts production of Blue Moon beer for the US market from its Montreal brewery

Molson Canada announced on May 5 the start of production of Blue Moon beer for the US market from its Montreal brewery as of May 2005. This additional volume will bring a C$2 million investment in upgrades to its brewing facilities in Montreal. This is a part of the synergy initiative put in place following the Molson-Coors merger.

"The Molson-Coors merger will translate into very interesting opportunities for the Canadian breweries and their employees," said Daniel Pelland, Chief Brewing Officer for Molson Canada. "This transfer of Blue Moon volume to the Montreal brewery is the first phase of a larger plan to move more volume to our Canadian breweries."

Blue Moon production in Montreal is scheduled to start at the end of May 2005. Draught Blue Moon produced in Montreal will be in addition to the current Memphis brewery production volume. This additional volume is required as a result of the fast-paced growth of the brand in the US market and the additional volume required for this summer.

"This volume transfer to the Montreal brewery is great news for our members," said Guy Deslauriers, spokesperson for Molson's employee union. "We are pleased to experience first-hand the positive impact of the Molson-Coors merger." ...more info

Malaysia: Fraser & Neave Holdings Bhd, owner of Tiger Beer, posted 10.64% increase of its net profit

The owner of Tiger Beer, Fraser & Neave Holdings Bhd, posted its net profit for the second quarter to March 2005 was up 10.64 % compared with a year earlier...more info

Latin America: Latin beer success is attributed to NAFTA

According to economists the success of Latin beer is attributed to the relaxation of tariffs under the 1994 North American Free Trade Agreement (NAFTA).

Grupo Modelo's Corona ranks seventh in U.S. beer shipments, long outranking Heineken as the top imported beer in America, Associated Press commented on May 5. Modelo has increased its exports to the United States by 30 % a year.

Fomento Economico Mexicano SA, Mexico's other main beer company, is gaining market share with brands that include Dos Equis, Tecate and Bohemia.

In the past decade, annual U.S. malt beverage imports from Mexico rose from $36 million to $162 million. Beer and tequila now make up 22 percent of Mexico's $1.5 billion in food exports to the United States and the breweries employ 88,000 people in 11 Mexican states.

Analysts attribute the success to strategic pre-NAFTA alliances with U.S. beer giants and marketing genius that seems to promise a Mexican beach in each lime-enhanced sip. "Like everything, it started out with lack of availability, that right there gives it cachet," said Juli Niemann of RT Jones Capital Management in St. Louis. "When you get better availability, then it becomes largely a marketing thing." ...more info

Malt News

EU: EU malt exporters booked 1.85 million tonnes of export licences until April 27, 2005

EU malt exporters booked 1.85 million tonnes of export licences from July 1, 2004 until April 27, 2005. The following analysis shows that the EU will lose exports in excess of 300,000 tonnes during the current crop year.

New members could only fix licences after accession, 46,000 tonnes in May/June 2004. Their exports to countries outside today’s EU-25 were 269,000 tonnes in 2003 and will be unchanged in the crop year 2004/05. They may have profited from the Russian import embargo on malt (phyto-certificates) from other EU countries.

Czech Republic: Czech malt production and exports in 2004

The Czech Republic produced 511,000 tonnes of malt in 2004...more info

Barley News

Australia: Graincorp cuts its profit forecast as dry conditions hit grain harvest

GrainCorp Ltd, Australia’s largest grain-handling and storage company, said it downgraded its full year profit forecast for 2004-2005 FY to the end of September to A$10-12 million...more info

EU: An unsold surplus of 5 million tonnes of free market and intervention barley

The EU sits on an unsold surplus of 5 million tonnes of free market and intervention barley...more info