Trouble ahead

The going certainly got a bit tougher for Molson in Brazil last year. Distribution problems were quoted as the main reason why Molson would not meet its EBIT growth target for the full year ending 31 March 2004. The recent deal between Interbrew and AmBev will is likely to muddy the water a bit further. AmBev is not only Molson’s main competitor in Brazil, it has also become its main competitor back home having obtained Labatt Canada from Interbrew in that complex stock and asset swap which marks the InterbrewAmBev combination. Molson bought what was then Brazil’s second largest brewer Cervejarias Kaiser for USD765 million two years ago from a consortium made up of the Coca-Cola Co., Heineken (which has a 20% stake in Molson’s Brazilian business) and 16 Brazilian Coke bottlers....

A tablespoon of peanut butter

As millions of Americans seem to be ardent followers of the Atkins diet, which preaches weight loss by cutting carbohydrates and sugar from one’s diet in favour of protein, brewers felt they had to respond to the latest food fad. They rolled out low-carb beers to please the carbohydrate counters. A bottle of a low-carb beer with 4.5 % ABV and 2.5 g of carbohydrates has about the same level of carbohydrates as eating a tablespoon of peanut butter.
By comparison, regular beers have between 11 g and 17 g of carbohydrates, equivalent to 10 Freedom fries (a note to our American readers: Is it ok to call them French fries again?). 60 percent of all Americans are considered overweight. In the US market it was Anheuser-Busch’s Michelob Ultra which started the new sub-category of beer..

Crying into their beers

No more Samba for Molson’s executives after the brewer announced that a sharp decline in Molson’s Brazilian sales during the final quarter of 2003 would prevent the company from meeting its 14.5 percent growth target for the full year ending 31 March 2004. Instead the company is now expecting EBIT to rise between 0 percent and 2 percent, to between CAD512 million and CAD520 million.
The volume of sales in Brazil in the October-December quarter was down 23 percent from a year earlier, which Daniel O’Neill, Molson’s President and CEO, explained by saying that the time needed to revamp the sales force in Brazil had taken much longer than expected. One analyst was quoted as saying that Molson’s brands in Brazil were "tired" (i.e.

New scale wrap around packer

Nigrelli Systems Inc., Kiel, WI/USA announced the introduction of it’s newest packaging machine; the Model SP-2000 Ultra-High Speed Wrap-Around Multipacker. This wrap-around style multipacker is capable of producing in excess of 200 packs per minute, with the capacity of 2400 containers per minute; nearly double the speed of high speed wrap-around multipackers currently available. Developed and manufactured at the request of an industry recognized corrugate sheet and paperboard supplier, the Model SP-2000 is capable of producing 12 to 24 packs of cylindrical containers (cans, bottles, etc.) typically used for beer, soft drinks, and other beverages. It also can pack smaller multipacks into a larger case size (i.e. 4 - 6 packs = 24 pack). More information is to be found under www.nigrelli.

MBAA announces 2003 award winners

At the 116th MBAA Convention held in October in Milwaukee/WI, the prestigious MBAA Presidential Award was given to Christoforos Lekkas, ICBD School of Science, for his poster, "The importance of free aminao nitrogen in wort and beer." Sandra van Nierop, South African Brewereies, received the award for her paper, "Enzymatic generation of factors from malt responsible for premature yeast flocculation," and Charles Bamforth, University of California, was awarded for his paper, "Starch in brewing: a review."

Call for Papers

The Technical Program Committee is soliciting papers and posters for presentation at the World Brewing Congress 2004, July 25 - 28, Hyatt Regency Hotel, San Diego, California.
The technical program calls for a blend of new topics of future visions to existing topics of importance to brewing science and associated indutries. Preliminary plans call for sessions centering around raw materials, wort production, yeast and fermantation including countinuous beer production, finishing, packaging, biotechnology, flavor stability, and related issues such as HACCP and ISO, consumer testing and health. Contributions relating to all other aspects of brewing and associated industries are welcomed. Prospective papers that present new analytical or microbiological protocols will be considered.3827.

Slight growth

Last year the US beer market enjoyed a bit of a bumpy ride. After a tough start, with a stumbling economy and consumer fears in the aftermath of 9/11, beer consumption bounced back in the fourth quarter. While results were mixed for individual brands in 2002, the overall picture looked bright, given the brewing industry’s performance early in the year. It has been estimated that domestic beer volume grew about 0.7 percent while import volume rose about 6.0 percent which made for a combined industry growth of modest 1.3 percent.
The prevailing trends, which affect the US beer market, are: consolidation in the industry, the changing face of beer consumers, continued growth of premium and super-premium products and the gradual shift to lighter beers..

Adieu, then

Pabst Brewing Co., the fourth-largest beer company in the US, has hired investment bankers Merrill Lynch to investigate its options, which can only mean that the US brewer has effectively been put up for sale. Valuations range from USD350 million to USD500 million. Rumour has it that Brian Kovalchuk, President and Chief Executive prefers a sale of
the entire business rather than individual brands. Whether there’s anybody out there willing to spend good money on dying standard brands - only time will tell.
Pabst was founded in Milwaukee more than 150 years ago but closed its brewery in Milwaukee in 1996. In the mid-1980s the S&P Company, founded by corporate raider Paul Kal-manovitz, purchased Pabst and subsequently moved its corporate headquarters to San Antonio..

How to talk to twentysomethings

Even Jim Koch, who founded The Boston Beer Company in 1984 and introduced the company’s flagship beer, Samuel Adams Boston Lager, in April 1985, has had to learn the lesson that every year it gets harder to keep the froth on a leading-edge beer brand. After almost 20 years in the market, Sam Adams is now just another speciality beer brand on a very cluttered shelf. Sam Adams may still be the best selling craft beer in the US market, but like its faithful consumers, the brand has grown middle-aged. As Koch himself admitted to local media, the brand continues to stand for quality, passion, authenticity and innovation, yet he does not know how to communicate that to a 23-year-old.
For six years, Boston Beer sales have been stuck at USD200 million..

Miller axed 200 jobs

In September Miller Brewing Co reduced its staff by about 200 positions at the company’s corporate offices in Milwaukee. The move will leave about 800 corporate positions. Those who are let go will be offered severance benefits and outplacement services. No brewery jobs were affected, though. The layoffs had been expected since May, when Norman Adami, Miller’s President, said that Miller was planning a restructuring that would cut jobs in its headquarters. According to local reports, Miller’s market share in Wisconsin has fallen in the last four years. Miller’s share of the Wisconsin beer market was 46.6% at the end of 1999, compared to 29% for Anheuser-Busch. By the end of last year, Miller’s market share had dropped to 45.2%, while Anheuser-Busch had boosted its share to 32.3%.