just the facts - The Australian beer market
Volume growth in the Australian beer market in 2009 was mainly driven by the collapse of RTD sales
Australia's beer market is expected to remain tough in the short-term, Stephen Matthews, the head Carlton & United Breweries, Foster's Group's beer arm told analysts this week. Here we take a closer look at the Australian beer market with the help of Euromonitor's 'Beer in Australia' report.
- The Australian beer market experienced volume growth of 2% in 2009, which was mainly driven by the collapse of RTD sales due to the introduction of higher taxes on these beverages. As well as the tax, there is reason to believe that beer in Australia is enjoying a reinvigoration of image. Premium beer is continuing to grow in volume terms, craft beers are becoming increasingly prevalent and domestic standard beer is benefiting from innovation, in particular the growth of 'blonde' beer and the rise of mid-strength and flavoured beers.
- The majority of beer imported into Australia is premium lager, led by Corona Extra. Imported premium lager represented 12% of total premium lager volume and 2% of total beer sales in 2009. International brands such as Heineken, Beck's, Guinness, Stella Artois and Cascade are all produced under licence locally and so are not considered to be imports. These licensing arrangements have occurred progressively across the years and so will explain significant year-on-year variations in trend within imported premium lager.
- In the off-trade, the two dominant retailers in Australia are Coles Supermarkets and Woolworths, which are both directly involved in importing beer. They both import premium, standard and some economy beers. There have also been suggestions that retailers are involved in parallel importing - offering imported versions of beers that are also produced within the country under licence - particularly of well-known international brands.
- Private label beer is a relatively new introduction to the Australian beer market, and to date (March 2010), its impact has been minimal. However, Coles and Woolworths are both showing signs of building private label as well as other, exclusive, economy brands. Woolworths acquired a 25% stake in the Western Australian-based brewery Gage Roads Brewing last year for AUD1.9m (US$1.4m). Also, both retailers are importing several economy brands of beer, including beer sourced from Mexico.
- The average price per litre of beer in Australia is forecast to decline from AUD7.18 in 2009 to AUD6.38 in 2014 as a result of the increasing presence of private label, the continuing drift away from on-trade as at-home entertaining continues to increase, and the slowing in growth of premium beers and renewed growth in standard domestic beer. Volumes, meanwhile, are expected to grow by 10.1% to 2.06bn litres, while sales are expected to slide to AUD13.16bn in 2014 from AUD13.46bn last year.
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