Heineken turns to kvass
Playing the patriotic card or what? Dutch brewer Heineken will start producing the traditional bread-based drink kvass at four of its Russian breweries as the country’s beer market battles a steep downturn, the brewer said on 23 April 2015.
The rationale behind Heineken’s move seems to be: if they don’t drink beer, let them have kvass. Kvass is a fermented slightly alcoholic (under 1.5% ABV) beverage commonly made from black or regular rye bread. The technology for brewing kvass is similar to beer, and so the company did not have to make any additional investments in equipment.
According to Russian media, Heineken hopes that the switch to kvass will help it fill empty capacity in its breweries. The Russian beer market is down roughly 30 percent since 2008 and Heineken’s beer sales plummeted 10 percent in the first quarter this year. Industry-wide, breweries operate at an estimated 60 percent of capacity.
Beer production in Russia fell 8.6 percent in 2014 to 81 million hl as a drop in the price of oil and Western sanctions over the Ukraine crisis slowed Russian economic growth to just 0.6 percent, Russian media say.
The kvass market, meanwhile, has been growing. Kvass sales rose 11 percent from January to July last year, according to market research firm Nielsen.
Heineken’s turn to kvass marks its second outing on the market. In 2005 the brewer launched a kvass brand under the name Stepan Timofeyevich, eventually taking around 9 percent of the market before selling the brand to leading kvass producer Deka in 2009. By the way, Heineken is not the only brewer producing kvass. Baltika, which is owned by Carlsberg, brews the brand Hlebny krai (“Bread land”) which it launched in 2009.
