Something’s brewing… in Israel

2011 was all about beer. Newspapers, magazines, blogs. Microbreweries got tons of great press. So BRAUWELT International went to the Middle East to find out what’s really going on.

Foster’s Australia (now acquired by SABMiller) can look forward for respite in a tax litigation, which has been going on India for a few years now. As our readers know, SABMiller had acquired Foster’s India from Foster’s Australia Ltd in 2006, for USD 120 million. The tangible and intangible assets of Foster’s India were taken over by SABMiller. The matter is sub-judice in a Pune court. Earlier, Foster’s Australia had approached the Authority of Advanced Ruling (AAR), a quasi-judicial body which ruled against the company and said the Australian beer company’s sale of brand and trademarks to SABMiller in India was taxable in the country.

Given that AB-InBev’s Budweiser is already dominating the profitable premium beer segment, SABMiller’s decision to launch its Miller Genuine Draft brand (MGD) in the Zhejiang region smacks of a five-to-twelve-effort.

Total shipments of beer and beer-like drinks in Japan dropped 3.7 percent in 2011 from a year earlier to a record low of 442.39 million cases. Although declining beer consumption is nothing new to Japan, last year’s decline was partly due to the massive March earthquake and tsunami that disrupted supplies, industry data, which was released on 17 January 2012, showed.

In the final quarter of 2011 Australian beer consumption is believed to have dropped 6 percent. In view of the fact that the last quarter of the year is the main drinking season – the Australian summer – the decline spells an unmitigated disaster.

In duopoly markets, foreign brewers often find themselves in a spot of bother: who shall brew their brands under license? In Australia, Kirin-owned Lion Nathan has emerged with the lion’s share of Australia’s top-selling imported beers, with Foster’s losing the rights to brew and distribute Stella Artois in one of the first effects of its takeover by SABMiller.

This is no small achievement for Australia’s third largest and still family-owned brewery: Coopers Brewery reported that beer production had lifted slightly to a record 629,000 hl in 2010/2011while the total beer market declined 6 percent.

It is that time of year again, when we analysts and journalists engage in introspecting the gone-by year and try to foretell the coming year – though, just a few days into New Year, it is hard to predict the course of industry in a very unpredictable country like India. But here is our take on what will shape the Indian beer industry in next twelve months.

The incoming owner of Foster’s has immediately put its stamp on the brewer, appointing one of its top operators to replace CEO John Pollaers.

From Russia with love

The day the world changed. On Christmas Day 1991 Mikhail Gorbachev resigned as the last leader of the Soviet Union and Boris Yeltsin ordered the red flag to be lowered from the Kremlin. With 20 years hindsight we know why the USSR disappeared, not with fireworks but a damp squib. President Yeltsin inherited a decaying, bankrupt, thoroughly militarised and just as thoroughly corrupt communist empire, which he set out to reform through a shock therapy to create a private sector and open up the country to private investment. Among the first to latch onto this opportunity were a motley crew of Nordic and Indian investors who thought that building the Russian beer market was the opportunity of a lifetime.