Kirin to reposition its Devassa brand

As the economy is sinking into recession, Brazil Kirin – the renamed brewer Schincariol – has decided to reposition its popular Devassa brand, while discontinuing the most popular version “Bem Loura”, betting only on the premium variety, made with malt and without the addition of other cereals such as corn and rice, Brazilian media reported on 8 June 2016.

In spite of Devassa’s premium appeal, the retail price will only be upper-mainstream. Kirin justifies this anomaly by saying that it hopes to attract an audience which aspires to premium beers, but now faces a time of lower disposable incomes.

According to Brazilian media, the premium segment comprises 5.7 percent of the beer market. Mainstream beers still held a 68 percent share in 2015, declining from 72 percent in 2014.

Kirin’s investment in Brazil seems to have hit a bit of a rough patch. In April 2016, the country’s competition watchdog CADE confirmed that it is reviewing Kirin’s proposed sale of a brewery near Rio de Janeiro to beer market leader AmBev. Built in 2000, the facility produces beer, soft drinks and water. Brazil Kirin has 13 plants in the country. Its core market is in the northeast of the country.

Beer production in Brazil declined 2.6 percent during the first five months of the year. For the first quarter of 2016, AmBev reported a 10 percent decline in volume sales. Beer production was already down 2 percent in 2015 over 2014.