Argentina Food and Drink Report 2013

Published: November 2012

Publisher: Business Monitor International (BMI)

Product ref: 152845

Pages: 93

Format: PDF

Delivery: Immediate download

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Price: $ 1175.00

Report description

Argentina has slipped down our regional ranking for the food and drink market in relation to 2012 on account of the worsening of both its risk and rewards scores. We believe that the government’s increasingly aggressive interventionist policies will result in more high inflation and low growth in 2013.

Moreover, we expect productive capacity to continue to deteriorate as long as strict capital controls and import restrictions remain in place. All of this will be reflected in the weakening of consumer confidence, and we expect that inflation-related factors, rather than volume increases, will be key drivers of food and drink values’ growth.

Headline Industry Data

2013 per capita food consumption (local currency) = +13.6%; forecast compound annual growth rate (CAGR) to 2017 = +9.4%

2013 alcoholic drink sales (litres) = -1.6%; forecast CAGR to 2017 = -0.8%

2013 soft drink sales (litres) = +0.0%; forecast CAGR to 2017 = +2.5%

2013 mass grocery retail sales (local currency) = +15.1%; forecast CAGR to 2017 = +12.2%

Key Industry Trends & Developments

Arcor To Enter Domestic Cereal Market: In July 2012, major Argentine food producer Arcor announced plans to enter the Argentine cereal market. As the market for cereal in Argentina is very small, Arcor will have to build the category as well as entice consumers to opt for its brands. However, the growing popularity of milk, combined with the desire for more convenience, means that the category has significant potential, and thus may attract investment from other major players such as Kellogg. Multinationals Continue Investing in Argentina: In April 2012, US-based food conglomerate Kraft Foods begun the production of its Milka chocolate brand at its Buenos Aires facility in Argentina. The local production has enabled the firm to replace the imports of the product from Brazil, said Pedro López Matheu, the corporate issues director for the South Cone region for Kraft. The local production of the chocolate brand is part of Kraft’s expansion plan, which it had formed for the past three years. The Milka chocolate brand is reportedly the second best-selling chocolate brand in the country.

Key Risks to Outlook

Economic Development: Argentina’s economic future is largely dependent on how long President Cristina Fernández de Kirchner can sustain policies that are creating significant economic imbalances within the Argentine economy. We believe that, the longer these policies are in place, the greater will be the risks to Argentina’s vast economic growth potential.

Elevated Inflation: Argentina’s high inflation rate, which we believe to be in the mid-20s rather than the high single-digit levels reported by statistics agency INDEC, remains one of the largest threats to the country’s long-term economic stability, continuing to weigh on credit growth and hampering muchneeded investment. What is more, the uncertainty surrounding the true rate of inflation is likely to cause additional damage to business investments.

Exchange Rate Risk: We believe that the Argentine peso is significantly overvalued. We therefore expect devaluation in 2013, boosting export competitiveness.

Business Environment: Nationalisation of private assets has allowed the government to meet its financing gap over the past two years, but the strategy is a short-term fix with negative long-term consequences. Business leaders have begun to fear that a transition to Venezuela-style policies could be in the offing. Although we see this as unlikely, we doubt that a reversal of the policies is on the cards.

Table of contents

Chapter 1 - BMI Industry View

Chapter 2 - SWOT Analysis

Argentina Food Industry SWOT

Argentina Drink Industry SWOT

Argentina Mass Grocery Retail Industry SWOT

Chapter 3 - Business Environment

BMI’s Core Global Industry Views

Table: Core Views

Latin America Risk/Reward Ratings

Table: Latin America Q Food & Drink Risk/Reward Sub-Factor Ratings (scores out of )

Table: Latin America Q Food & Drink Risk/Reward Ratings

Argentina’s Food & Drink Risk/Reward Rating

Macroeconomic Outlook

Table: Economic Activity

Chapter 4 - Industry Forecast Scenario

Consumer Outlook

Food

Food Consumption

Table: Food Consumption Indicators – Historical Data & Forecasts, -

Canned Food

Table: Canned Food Value/Volume Sales – Historical Data & Forecasts, -

Confectionery

Table: Confectionery Value/Volume Sales – Historical Data & Forecasts, -

Prepared Food

Oils & Fats

Table: Oils & Fats Volume Sales, Production & Trade – Historical Data & Forecasts, -

Dairy

Table: Dairy Volume Sales, Production & Trade – Historical Data & Forecasts, -

Drink

Hot Drinks

Table: Coffee Value Sales – Historical Data & Forecasts, -

Table: Tea Value Sales – Historical Data & Forecasts, -

Alcoholic Drinks

Table: Alcoholic Drinks Value/Volume Sales – Historical Data & Forecasts, -

Soft Drinks

Table: Soft Drink Value Sales – Historical Data & Forecasts, -

Table: Carbonated Soft Drinks Volume Sales, Production & Trade – Historical Data & Forecasts, -

Mass Grocery Retail

Table: Mass Grocery Retail Sales By Format – Historical Data & Forecasts, -

Table: Sales Breakdown by Retail Format Type

Trade

Table: Trade Indicators – Historical Data & Forecasts, -

Chapter 5 - Food

Key Industry Trends And Developments

Arcor To Enter Domestic Cereal Market

Investments Into Argentina Continue, But BMI Remains Cautious

PepsiCo Investing As It Continues To Build Global Snack Business

Arla Expands To Exploit Growing Dairy Consumption

Market Overview

Food Production

Processed Food

Meat & Dairy

Fish & Seafood

Table: Fish Volume Sales, Production & Trade – Historical Data & Forecasts, -

Chapter 6 - Drink

Key Industry Trends And Developments

Argentine Wines Expanding Globally

Brewers Investing In Argentina

Market Overview

Soft Drinks

Alcoholic Drinks

Beer

Wine

Spirits

Hot Drinks

Chapter 7 - Mass Grocery Retail

Key Industry Trends And Developments

Cencosud Takes Control Of Argentine Subsidiary

Carrefour Expands Via Acquisition Of Local Player

Market Overview

Leading Retailers

Table: Structure Of Mass Grocery Retail Sector By Estimated Number Of Outlets

Table: Structure Of Mass Grocery Retail Market – Sales By Format (US$bn)

Table: Average Annual Sales Value by Format –

Chapter 8 - Competitive Landscape

Table: Key Players In Argentina’s Food & Drink Sector

Table: Key Players In Argentina’s Mass Grocery Retail Sector

Chapter 9 - Company Analysis

Food

Nestlé Argentina SA

Grupo Arcor

Quickfood SA (Marfrig Group)

Molinos Río de la Plata

Molfino Hermanos (Saputo Group)

Drink

Quilmes Industrial SA

Mass Grocery Retail

Carrefour

Cencosud

Chapter 10 - Demographic Outlook

Table: Argentina's Population By Age Group, - (')

Table: Argentina's Population By Age Group, - (% of total)

Table: Argentina's Key Population Ratios, -

Table: Argentina's Rural And Urban Population, -

Chapter 11 - Risk/Reward Ratings Methodology

Table: Rewards

Table: Risks

Weighting

Table: Weighting

Chapter 12 - BMI Food & Drink Industry Glossary

Food & Drink

Mass Grocery Retail

Chapter 13 - BMI Food & Drink Forecasting & Sourcing

How We Generate Our Industry Forecasts

Sourcing

Price: $ 1175.00

Related research categories

By sector: General drinks

By market: Argentina (in South America)