Analysis

just the Facts - Euromonitor International: The Global Soft Drinks Industry

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Euromonitor International analysts yesterday (14 April) presented a webinar on 'The Global Soft Drinks Industry - A Year of Recovery in 2010 with Implications for 2011 and Beyond'. Here, just-drinks takes a look at some of the figures and comments from the presentation.

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  • In 2010 and 2011, the soft drinks industry was expected to grow in global total volume terms by 4.4% and 3.8%, respectively. However, in value terms, this will be below volume growth with value expected to increase between 1% and 2% in both years. These rates, particularly for total volume, are beginning to recover from the depths of the financial crisis, although growth rates are not quite back to pre-crisis levels.
  • "Bottled water was the top volume category and saw a better performance in 2010 [than 2009]," said Brian Morgan, a beverage analyst at Euromonitor. "Most markets showed a bit of a recovery but we had a lot of declines, especially in Western Europe and even in the US, driven by environmental concerns and negative media coverage. There was a rebound in 2010 in Spain in particular. Moving forward over the next five years, the bulk of growth will be from developing regions like China."
  • "In sport drinks, the growth is primarily coming from Asia and Western Europe," said Euromonitor's head of beverage research, Richard Haffer. "Indonesia ... will be seeing the largest increase. That is also attributable to growing incomes and greater affluence. In Western Europe .. growth will be coming more from market segmentation, ie sports drinks targeted at women. The US and Japan are two highly developed markets [for sports drinks] and they will be dragging down global growth, which will continue but at a much lower pace. Most of the opportunities will lie outside the markets that have traditionally been the largest markets for sports drinks."
  • "For juice, the recovery in particular came from Russia," said Morgan. "A double-digit decline in 2009 turned into a double-digit increase in 2010, particularly due to acquisitions like PepsiCo's move for Wimm-Bill-Dann. Russia is predicted to be a high-growth market moving forward, but it is actually China that is the strongest market overall and has consistently grown double-digit in volume terms and is expected to in the future."
  • "In the Middle East and Africa, Coca-Cola and PepsiCo have more than 40% of the soft drinks volume share combined, primarily through their carbonates business," Haffner said. "There is tremendous opportunity for growth. Coca-Cola and PepsiCo are coming into this region in a big way. Their share minus carbonates, however, is looking different. Nestle is actually the leader in non-carbonates with around an 11% share. Coca-Cola has a 7% share and Danone 3%." (PepsiCo did not appear in the top five).

Sectors: Soft drinks, Water

Companies: PepsiCo, Nestle, Groupe Danone

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