Central America Food and Drink Report Q4 2012

We remain broadly optimistic in our outlook for the Central American consumer (covering the markets of Guatemala, Honduras, Costa Rica and El Salvador), despite the downside risks posed by the global economic uncertaintly and the increased security risks in parts of the region. Further development of organised retail will allow for a degree of premiumisation to take place, with discounters expected to outperform.

Headline Industry Data (regional averages) ?? 2012 per capita food consumption (US$) = +5.0%; forecast to 2016 = +26.9% ?? 2012 alcoholic drink sales (litres) = +6.3%; forecast to 2016 = +35.4% ?? 2012 soft drink sales (litres) = +5.6% ; forecast to 2016 = +31.4% ?? 2012 MGR sales (US$) = +5.9%; forecast to 2016 = +33.6%

Key Company Trends Coca-Cola Trials Biogradable Bags in El Salvador: In July 2012, US beverage company The Coca-Cola Company successfully trialled biodegradable bottle-shaped plastic bags for its flagship brand Coke in El Salvador and subsequently in neighbouring countries, according to Beverage Daily. Street vendors had been selling the drink in plastic bags as consumers didn’t want to pay extra for the returnable glass bottle. Coca-Cola designed the new bags in the contour bottle shape to recover its brand image and save consumers money.

Costa Rica Starts Exports of Milk to Venezuela: In a move signalling the return to strength of the Costa Rican dairy industry, exports of milk to Venezuela were shipped in June 2012. The Dos Pinos Cooperative of Milk Producers is expecting to export 240 containers of UHT milk, worth some US$5mn, with further expansion of volumes likely to occur given rising demand in Venezuela. Key Risks To Outlook

Multifold Risks: In addition to violence and the overreliance on the US for remittances and demand for exports, Central American countries also remain at risk due to the factors such as the pervasive nature of corruption, a function of the region’s weak institutional capacity, combined with massive income inequality and a broader culture of clientelism. Poor and uneven economic development will keep demand for redistributive policies strong, and this will continue to clash with what in many cases is much-needed fiscal retrenchment. A final factor that will continue to blight Central America – exacerbating the aforementioned challenges – is natural disasters, including flooding, drought, earthquakes and in some cases volcanoes. Add to this a weak fiscal and institutional framework to deal with any fallout, and we expect natural disasters to continue derailing broader developmental goals.

Table of contents

Chapter 1 - BMI Industry View

SWOT Analysis

Central America Food Industry SWOT

Central America Drink Industry SWOT

Central America Mass Grocery Retail Industry SWOT

Chapter 2 - Business Environment

BMI’s Core Global Industry Views

Table: Core Views

Latin America Risk/Reward Ratings

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

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

Central America Risk/Reward Ratings

Regional Macroeconomic Outlook

Chapter 3 - Industry Forecast Scenario

Consumer Outlook

Food

Food Consumption

Table: Guatemala – Food Consumption, -

Table: Costa Rica – Food Consumption, -

Table: El Salvador – Food Consumption, -

Table: Honduras – Food Consumption, -

Confectionery

Table: El Salvador – Confectionery, -

Meat

Table: El Salvador – Meat, -

Jams & Jellies

Table: El Salvador – Jams & Jellies, -

Pasta

Table: El Salvador – Pasta, -

Prepared Fish

Table: El Salvador – Fish, -

Table: Costa Rica – Fish, -

Oils & Fats

Table: Costa Rica – Soya Bean Oil, -

Table: Guatemala – Soya Bean Oil, -

Table: El Salvador – Margarine, -

Dairy

Table: El Salvador – Dairy, -

Drink

Hot Drinks

Table: Guatemala – Coffee, -

Table: Costa Rica – Coffee, -

Table: El Salvador – Coffee, -

Table: Honduras – Coffee, -

Alcoholic Drinks

Central America Food & Drink Report Q

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Table: Guatemala – Alcoholic Drinks, -

Table: Costa Rica – Alcoholic Drinks, -

Table: El Salvador – Alcoholic Drinks, -

Table: Honduras – Alcoholic Drinks, -

Soft Drinks

Table: Guatemala – Soft Drink Sales, -

Table: Costa Rica – Soft Drink Sales, -

Table: El Salvador – Soft Drinks, -

Table: Honduras – Soft Drinks, -

Mass Grocery Retail

Table: Sales Breakdown By Retail Format, %

Table: Guatemala – Mass Grocery Retail Sales, -

Table: Costa Rica – Mass Grocery Retail Sales, -

Table: El Salvador – Mass Grocery Retail Sales, -

Table: Honduras – Mass Grocery Retail Sales, -

Trade

Table: Guatemala – Trade Indicators, -

Table: Costa Rica – Trade Indicators, -

Table: El Salvador – Trade Indicators, -

Table: Honduras – Trade Indicators, -

Chapter 4 - Food

Key Industry Trends And Developments

Florida Ice And Farm 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 5 - 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 6 - Mass Grocery Retail

Key Industry Trends And Developments

Walmart Launches New Discount Format In El Salvador

Walmart Investing In Expansion

Colombian Retailer Olimpica Moves Into Central America

Market Overview

Chapter 7 - Competitve Landscape

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

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

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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 8 - Company Profiles

Food

Diana Food

Drink

Central America Beverage Corporation (CABCORP)

SABMiller

Mass Grocery Retail

Walmart Centroamerica

Chapter 9 - Country Snapshot

Guatemala

Table: Guatemala’s Population By Age Group, - (‘)

Table: Guatemala’s Population By Age Group, - (% of total)

Table: Guatemala’s Key Population Ratios, -

Table: Guatemala’s Rural And Urban Population, -

Costa Rica

Table: Costa Rica’s Population By Age Group, - (‘)

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

Table: Costa Rica’s Key Population Ratios, -

Table: Costa Rica’s Rural And Urban Population, -

El Salvador

Table: El Salvador’s Population By Age Group, - (‘)

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

Table: El Salvador’s Key Population Ratios, -

Table: El Salvador’s Rural And Urban Population, -

Honduras

Table: Honduras’s Population By Age Group, - (‘)

Table: Honduras’s Population By Age Group, - (% of total)

Table: Honduras’s Key Population Ratios, -

Table: Honduras’s Rural And Urban Population, -

Chapter 10 - Risk/Reward Ratings Methodology

Table: Rewards

Table: Risks

Weighting

Table: Weighting

Chapter 11 - BMI Food & Drink Industry Glossary

Food & Drink

Mass Grocery Retail

Chapter 12 - BMI Food & Drink Forecasting & Sourcing

How We Generate Our Industry Forecasts

Sourcing

Related research categories

By sector: General drinks