Central America Food and Drink Report Q1 2013

While we do not believe the Central American region will regain its mid-2000s pre-crisis dynamism over the next decade, we do see potential for growth to begin to accelerate toward the end of our forecast period on the back of a more favourable demographic picture, efforts at greater regional infrastructure and transport convergence, and the region's geographic proximity to a rising Latin American middle class. However, the regional two-speed growth story looks set to remain in play. Underperformers - namely Nicaragua, Guatemala, Honduras and El Salvador - are highly dependent on remittance inflows from the US and external demand for their low value-add manufactured goods, and as such are the most exposed to a US economic slowdown. Meanwhile, outperforming economies - those of Panama and Costa Rica - have managed to move up the value chain and expand their services sectors, boosting exports and investment.

Headline Industry Data (regional averages)

?? 2013 per capita food consumption (US$) = +4.68%; forecast compound annual growth rate (CAGR) to 2017 = +4.92

%?? 2013 alcoholic drink sales (litres) = +5.71%; forecast CAGR to 2017 = +5.46

%?? 2013 soft drink sales (litres) = +5.88% ; forecast CAGR to 2017 = +5.60

%?? 2013 MGR sales (US$) = +5.70%; forecast CAGR to 2017 = +6.04

%Key Company Trends

Florida Ice And Farm Building North American Exposure: In October 2012, Costa Rica-based drinks producer Florida Ice and Farm agreed a deal worth US$388mn to acquire North American Breweries from its private equity owners KP Capital Partners. The business includes the brands Labatt and Genesee, and operates across the US and Canada. It was previously owned by Belgium's InBev but was sold to its current owners as part of the conditions of InBev's acquisition of Anheuser-Busch. Dutch brewer Heineken has a 25% stake in Florida Ice and Farm, and the move has been tied to Heineken's regional ambitions as it looks to build its business across the Americas.

Key Risks To Outlook

Elevated Political And Economic Risks: Political stability will remain elusive for much of Central America over the next decade. Indeed, given the limited resources of most Central American economies, the elevated violence, corruption and social unrest that currently define the region's political risk profile are likely to remain continued obstacles to growth. Similarly, Central America's economic links to the US, through trade, remittance inflows and investment, leave it vulnerable to a structurally weaker US growth story. Combined with strong competition from Asia, the region's poor business environment and diminished macroeconomic buffers in the wake of the financial crisis suggest that it will remain stuck on the wrong side of the global rebalancing for much of the next decade.

Table of contents

Chapter - BMI Industry View

Chapter - SWOT Analysis

Central America Food Industry SWOT

Central America Drink Industry SWOT

Central America Mass Grocery Retail Industry SWOT

Chapter - Business Environment

BMI's Core Global Industry Views

Table: Core Views

Latin America Risk/Reward Ratings

Table: Latin America Q113 Food & Drink Risk/Reward Sub-Factor Ratings (scores out of 10)

Table: Latin America Q113 Food & Drink Risk/Reward Ratings

Central America Risk/Reward Ratings

Regional Macroeconomic Outlook

Table: Central America Real GDP, % chg y-o-y

Chapter - Industry Forecast Scenario

Consumer Outlook

Food

Food Consumption

Table: Guatemala – Food Consumption Indicators, 2010-2017

Table: Costa Rica – Food Consumption Indicators, 2010-2017

Table: El Salvador – Food Consumption Indicators, 2010-2017

Table: Honduras – Food Consumption Indicators, 2010-2017

Confectionery

Table: El Salvador – Confectionery Value/Volume Sales, 2010-2017

Meat

Table: El Salvador – Meat Volume Sales, Production & Trade, 2010-2017

Jams & Jellies

Table: El Salvador – Jams & Jellies Volume Sales, Production & Trade, 2010-2017

Pasta

Table: El Salvador – Pasta Volume Sales, Production & Trade, 2010-2017

Prepared Fish

Table: El Salvador – Fish Volume Sales, Production & Trade, 2010-2017

Table: Costa Rica – Fish Volume Sales, Production & Trade, 2010-2017

Oils & Fats

Table: Costa Rica – Soya Bean Oil Volume Sales, Production & Trade, 2010-2017

Table: Guatemala – Soya Bean Oil Volume Sales, Production & Trade, 2010-2017

Table: El Salvador – Margarine Volume Sales, Production & Trade, 2010-2017

Dairy

Table: El Salvador – Dairy Volume Sales, Production & Trade, 2010-2017

Drink

Hot Drinks

Table: Guatemala – Coffee Volume Sales, 2010-2017

Table: Costa Rica – Coffee Volume Sales, 2010-2017

Table: El Salvador – Coffee Volume Sales, 2010-2017

Table: Honduras – Coffee Volume Sales, 2010-2017

Alcoholic Drinks

Table: Guatemala – Alcoholic Drinks Volume Sales, 2010-2017

Table: Costa Rica – Alcoholic Drinks Volume Sales, 2010-2017

Table: El Salvador – Alcoholic Drinks Volume Sales, 2010-2017

Table: Honduras – Alcoholic Drinks Volume Sales, 2010-2017

Soft Drinks

Table: Guatemala – Soft Drink Volume Sales, 2010-2017

Table: Costa Rica – Soft Drink Volume Sales, 2010-2017

Table: El Salvador – Soft Drinks Volume Sales, 2010-2017

Table: Honduras – Soft Drink Volume Sales, 2010-2017

Mass Grocery Retail

Table: Regional Sales Breakdown By Retail Format, %

Table: Guatemala – Mass Grocery Retail Sales, 2010-2017

Table: Costa Rica – Mass Grocery Retail Sales, 2010-2017

Table: El Salvador – Mass Grocery Retail Sales, 2010-2017

Table: Honduras – Mass Grocery Retail Sales, 2010-2017

Trade

Table: Guatemala – Trade Indicators, 2010-2017

Table: Costa Rica – Trade Indicators, 2010-2017

Table: El Salvador – Trade Indicators, 2010-2017

Table: Honduras – Trade Indicators, 2010-2017

Chapter - Food

Key Industry Trends And Developments

Florida Ice And Farm Building North American Exposure

Florida Ice Enters Dairy Sector

Rising Interest In Ready-to-Eat Food

Pollo Tropical Launches First Franchised Restaurant In Costa Rica

Costa Rican Growers Must Adhere To New US Food Safety Law

Walmart Giving Producers A Hand

Market Overview

Chapter - Drink

Key Industry Trends And Developments

Coca-Cola Trials Biogradable Bags In El Salvador

Costa Rican Farmers Setting Up Coffee Micro-Processing Plants

Starbucks Opens First Costa Rican Outlet

Honduras Struggles To Process Coffee Harvest

Regional Consolidation In Soft Drinks

Market Overview

Hot Drinks

Soft Drinks

Alcoholic Drinks

Chapter - Mass Grocery Retail

Key Industry Trends And Developments

Grupo Calleja Fails To Get Regulatory Approval To Acquire Europa SA

Walmart Launches New Discount Format In El Salvador

Walmart Investing In Expansion

Colombian Retailer Olimpica Moves Into Central America

Market Overview

Chapter - Competitve Landscape

Table: Key Players In Central America's Food & Drink Sector

Table: Key Players In Guatemala's Mass Grocery Retail Sector

Table: Key Players In El Salvador's Mass Grocery Retail Sector

Table: Key Players In Costa Rica's Mass Grocery Retail Sector

Table: Key Players In Honduras's Mass Grocery Retail Sector

Chapter - Company Profiles

Food

Diana Food

Drink

Central America Beverage Corporation (CABCORP)

SABMiller

Florida Ice and Farm

Mass Grocery Retail

Walmart Centroamerica

Chapter - Country Snapshot

Guatemala

Table: Guatemala's Population By Age Group, 1990-2020 (‘000)

Table: Guatemala's Population By Age Group, 1990-2020 (% of total)

Table: Guatemala's Key Population Ratios, 1990-2020

Table: Guatemala's Rural And Urban Population, 1990-2020

Costa Rica

Table: Costa Rica's Population By Age Group, 1990-2020 (‘000)

Table: Costa Rica's Population By Age Group, 1990-2020 (% of total)

Table: Costa Rica's Key Population Ratios, 1990-2020

Table: Costa Rica's Rural And Urban Population, 1990-2020

El Salvador

Table: El Salvador's Population By Age Group, 1990-2020 (‘000)

Table: El Salvador's Population By Age Group, 1990-2020 (% of total)

Table: El Salvador's Key Population Ratios, 1990-2020

Table: El Salvador's Rural And Urban Population, 1990-2020

Honduras

Table: Honduras's Population By Age Group, 1990-2020 (‘000)

Table: Honduras's Population By Age Group, 1990-2020 (% of total)

Table: Honduras's Key Population Ratios, 1990-2020

Table: Honduras's Rural And Urban Population, 1990-2020

Chapter - Risk/Reward Ratings Methodology

Table: Rewards

Table: Risks

Weighting

Table: Weighting

Chapter - BMI Food & Drink Industry Glossary

Food & Drink

Mass Grocery Retail

Chapter - BMI Food & Drink Forecasting & Sourcing

How We Generate Our Industry Forecasts

Sourcing

Related research categories

By sector: General drinks