Ukraine Food and Drink Report Q1 2013
Report description
Recent economic indicator readings in Ukraine suggest a more aggressive economic slowdown earlier than we anticipated. As a result, we have downgraded our real GDP growth forecasts to -0.1% and 1.0 %in 2012 and 2013 respectively, from a previous forecast of 2.0% and 0.9%. Additionally, Ukraine's GDP per capita is expected to remain one of the lowest in Europe over the decade ahead. Although there remains enormous unrealised potential in terms of political reform and economic growth, without institutional and economic reform, Ukraine's current economic growth model will prove unsustainable over the coming 10 years.
Headline Industry Data (local currency)
?? 2013 per capita food consumption = +11.2%; five-year forecast to 2017 = +52.7
%?? 2013 alcoholic drinks value sales = +12.1%; five-year forecast to 2017 = +59.4
%?? 2013 soft drinks value sales = +12.0%; five-year forecast to 2017 = +56.3
%?? 2013 mass grocery retail = +14.9%; five-year forecast to 2017 = +66.8
%Key Company Trends
Multinationals Target Ukraine Biscuit Sector: Mondelez International, the snacks division of the newly divided Kraft Foods Group, announced plans in October 2012 to launch a second biscuit factory in Ukraine. Under its Ukrainian expansion drive, Mondelez will commission a new biscuit production line for its Vedmedik Barni brand. The announcement comes as competition heats up with Nestlé which is also believed to be eyeing the growth opportunities in the Ukrainian biscuit sector. It is understood that the company plans to invest UAH244mn (US$30mn) in a bid to expand its Ukrainian confectionery business. According to our data, per capita consumption of sweet biscuits in Ukraine is forecast to increase from about 10kg in 2010 to about 12kg by 2017.
Auchan to Expand in Ukraine Solo: In autumn 2012 it was reported that French retailer Auchan has announced plans to sign a loan agreement with the IFC under which the body will provide a US$75mn loan to the retailer for expanding its business in Ukraine. Subsequent to the loan approval, Auchan will open up hypermarkets and shopping malls in the cities of Kiev and Odessa by 2015. It is understood that Auchan will continue store developments in the country without the input of its local partner Furshet. According to officials at Auchan the retailer is now developing in Ukraine on its own.
Key Risks To Outlook
Effects of Devaluation: A sharper than expected devaluation could trigger major shockwaves through the domestic economy, particularly within the financial sector which has barely recovered from the 2008 devaluation. Our expectation for a 12% devaluation of the hryvnia is likely to trigger a major downswing in household consumption as household savings are eroded and the concomitant inflation reduces household purchasing power.
Table of contents
Chapter - BMI Industry View
Chapter - SWOT Analysis
Ukraine Food Industry SWOT
Ukraine Drink Industry SWOT
Ukraine Mass Grocery Retail Industry SWOT
Chapter - Business Environment
BMI's Core Global Industry Views
Table: Core Views
CEE Food & Drink Risk/Reward Ratings
Table: Central & Eastern Europe Q113 Food & Drink Risk/Reward Ratings
Table: Central & Eastern Europe Q113 Food & Drink Risk/Reward Sub-Factor Ratings (scores out of 10)
Ukraine's Food & Drink Business Environment Ratings
Macroeconomic Outlook
Table: Economic Activity
Chapter - Industry Forecast Scenario
Consumer Outlook
Food
Food Consumption
Table: Food Consumption Indicators – Historical Data & Forecasts, 2010-2017
Confectionery
Table: Confectionery Value/Volume Sales – Historical Data & Forecasts, 2010-2017
Prepared Food
Table: Meat Volume Sales, Production & Trade – Historical Data & Forecasts, 2010-2017
Table: Jams & Jellies Volume Sales, Production & Trade – Historical Data & Forecasts, 2010-2017
Table: Pasta Volume Sales, Production & Trade – Historical Data & Forecasts, 2010-2017
Table: Snack Foods Volume Sales, Production & Trade – Historical Data & Forecasts, 2010-2017
Dairy
Table: Dairy Volume Sales, Production & Trade – Historical Data & Forecasts, 2010-2017
Drink
Alcoholic Drinks
Table: Alcoholic Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017
Soft Drinks
Table: Soft Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017
Hot Drinks
Table: Hot Drinks Value/Volume Sales – Historical Data & Forecasts
Mass Grocery Retail
Table: Mass Grocery Retail Sales By Format – Historical Data & Forecasts
Table: Grocery Retail Sales By Format (%)
Trade
Table: Trade Indicators – Historical Data and Forecasts
Chapter - Food
Key Industry Trends And Developments
Multinationals Invest In Ukraine Biscuit Sector
Roshen Expands Tts Footprint Outside Ukraine
Cheese Dispute Benefits Danone
Nestlé Ukraine Outperforms Rest Of Europe
Agriculture Continues To Attract Interest
Government Calls For Greater Investment Into Agriculture
Dairy Industry Consolidates And Changes Direction
Market Overview
Food Processing
Key Players
Confectionery
Trade
Agriculture
Chapter - Drink
Key Industry Trends And Developments
Wine Market Demonstrates Potential
Budweiser Launched In Ukraine
Anadolu Efes Looks For Acquisitions
Oasis CIS Seeks Expansion Through Acquisition
The Beer Industry Seems To Be Growing Against The Odds
Ukrainian Spirits Majors Targeting Russia
Market Overview
Alcoholic Drinks
Beer
Wine
Spirits
Soft Drinks
Hot Drinks
Chapter - Mass Grocery Retail
Key Industry Trends And Developments
Auchan To Expand In Ukraine Solo
Prevalence Of Informal Retailing Leaves Room For Formalisation
Ukraine Consumers Turn To MGR Outlets
Retail Space Expanding Despite Economic Adversity
Investment Into Hypermarkets Continues
Supermarket Expansion Also On Cards
Market Overview
Leading Retailers
Table: Mass Grocery Retail Market By Number Of Outlets, 2000-2010
Table: Average Annual Sales By Outlet Type, 2010
Chapter - Competitive Landscape
Table: Key Players In Ukraine's Food Sector
Table: Key Players In Ukraine's Drink Sector
Table: Key Players In Ukraine's Mass Grocery Retail Industry
Chapter - Company Monitor
Food
Ukrproduct
Myronivsky Hliboproduct (MHP)
Danone-Unimilk (Halakton)
Roshen
Konti
Astarta-Kyiv
Drink
Sun InBev Ukraine
Carlsberg Ukraine
Obolon
Odessa Champagne Factory
Nemiroff
Mass Grocery Retail
Fozzy Group
Billa
ATB Market
Auchan
Chapter - Country Snapshot
Table: Ukraine's Population By Age Group, 1990-2020 (‘000)
Table: Ukraine's Population By Age Group, 1990-2020 (% of total)
Table: Ukraine's Key Population Ratios, 1990-2020
Table: Ukraine'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
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