Slide 1 - Beer Institute

Report
Beer Institute, Research
Washington, DC
Draft Beer Industry Update, 2011
Lester Jones
Chief Economist
Beer Institute, Washington, DC
Measuring the Malt Beverage Industry
(brewers/importers -- distributors-- retailers -- consumers)
1. Industry Supply
2. State Shipments
US Total = -2.0%
US Total = -1.8%
Domestic (-2.6%) + Imports (+1.9%)
NC (+1.1%), FL(+1.0%), TX (+0.5%)
(100% of Industry volumes)
(100% of industry volumes)
3. Sales to Retailers
US Total= -1.9%
On-Prem (-2.2%) + Off-Prem (-1.9%)
(90% of industry volumes)
4. Sales to Consumers
US Total = -2.1%
(Food, Drug, Liquor & Conv)
• In 2010…
Draft Beer Market
– US brewers produced 556.8 million gallons of draft
– importers brought 68.5 million gallons of draft
– total draft industry was 625.3 million gallons
• From 2009 to 2010…
– Share of draft grew from 9.5% 2009 to 9.7% in 2010
– 1 out of 10 beers consumed in the US is a draft beer
– Total draft volumes grew +1.1% while overall industry declined
• Flow rate of 1 min/gallon and 625.3 million gallons
– 10.4 million hrs. -- 434,268 days -- 1,190 years to flow!
– If all 2010 volumes went through 1 keg, it would flow until the
year 3201!
Structure of Industry 1980-2010
1980
1990
2000
2010
48
298
1,500
1,600+
97%
95%
90%
87%
-
< 1%
3%
5%
Import Share
3%
5%
10%
13%
Can Share
53%
59%
51%
52%
Bottle Share
35%
30%
40%
38%
12%
5%
2%
0%
12%
11%
9%
9.7%
# of Brewers
Domestic Share
Craft Share (BA)
Refill Bottle
Draft Share
Source: Beer Institute, Brewers Association, Commerce Department, and TTB, 2011
Per Capita Consumption of Malt Beverages
1980 to 2010 (total gallons/total population)
1. 24.6 in 1981 20.6 in 2010
2. Demographics (baby boomer-millenniums )
25.0
3. Increased alcohol beverage competition
24.0
4. Increased non-alcohol beverage competition
23.0
5. Policy Changes (21 LDA and .08)
22.0
21.0
20.0
18.0
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2009
2010
19.0
Source: Beer Institute, 2011
Total Industry Supply
Millions
(Domestic Tax Paid + Imports)
205.0
200.0
195.0
190.0
185.0
180.0
7-8 million barrels off peak from early 1990s
(248 million gallons)
Source: Beer Institute, Commerce Department, and TTB, 2011
Percent of Respondents
Gallup Poll, 1992-2011
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Beer faces challenge as the preferred beverage of choice for US consumers .
(666 respondents with 5 pts +/- margin of error)
41% v 32%
36% v 35%
Beer
Wine
Liquor
The 18-34 year old group dropped from 51% in 2010 to 39% in 2011.
For people with incomes less than $30K, 51% are reported beer drinkers.
Source: Gallup Poll, 2011: Do you most often drink beer, wine, or liquor?
2010 Wine, Liquor and Beer
Volume Share and Growth Trends By Price Tiers
Wine
Liquor
Beer
Tiers
Share
Growth
Share
Growth
Share
Growth
High
26%
21%
24%
5%
17%
7%
Middle
33%
16%
36%
2%
54%
-2%
Low
41%
-14%
40%
0%
28%
-3%
Total
100%
2%
100%
2%
100%
-1%
Opportunity for beer to continue to grow in high end. Continued growth
for crafts, imports and specialties. Industry would need to add 15-20
million barrels into high end to match wine and spirits share distribution.
Source: Beer Institute, 2011 (Beer Marketers Insights, Discus, Beverage Information Group)
Industry Supply
Aug YTD 2010 vs. Aug YTD 2011
Total
Domestic
Import
2010 YTD (1,000s bls)
142,494
123,648
18,846
2011 YTD (1,000s bls)
139,661
120,461
19,201
% Change
-2.0%
-2.6%
+1.9%
Volume Change
-2,833
-3,187
355
86.3%
13.7%
Share of Total YTD
Eight months of data show a shift in share to imports with
imports growing +1.9% vs. -2.6% for domestics..
Source: Beer Institute, Commerce Department and TTB, 2011
Industry Supply – Package Mix
Aug YTD 2010 vs. Aug YTD 2011
Total
Packaged
Domestic
Packaged
Import
Draft
Domestic
Draft
Import
2010 (1,000s bls)
142,494
113,008
17,315
10,640
1,531
2011 (1,000s bls)
139,661
109,997
17,544
10,464
1,657
% Change
-2.0%
-2.7%
+1.3%
-1.7%
+8.2%
Volume Change
-2,833
-3,012
229
-176
125
78.8%
12.6%
7.5%
1.2%
Share of Total YTD
Eight months of data show a shift in share to imports with
imports growing +1.9% vs. -2.6% for domestics. This year,
draft is fairing much better than packaged (bottles) and is
gaining share of market thanks to growing imports.
Source: Beer Institute, Commerce Department and TTB, 2011
Growing US Draft Share
2002 - 2010
10.5%
Import draft took off in 2007 to peak at 9 share in 2008.
10.0%
9.5%
9.0%
8.5%
8.0%
7.5%
7.0%
2002
2003
2004
Imports
2005
2006
Domestic
2007
2008
Total
2009
2010
Bubble and Bust - Monthly Draft Import Volumes
12 Mos. Moving Average, Jan 2004 to Aug 2011
240,000
220,000
May 2007 to June 2008 = +1.4%
July 2008 to Dec 2009 = -1.3%
200,000
180,000
Jan 2010 to Aug 2011 = +0.5%
160,000
Jan 2005 to April 2007 = +0.7%
140,000
Recession
12/07 to 6/09
120,000
Jan-04
Mar-04
May-04
Jul-04
Sep-04
Nov-04
Jan-05
Mar-05
May-05
Jul-05
Sep-05
Nov-05
Jan-06
Mar-06
May-06
Jul-06
Sep-06
Nov-06
Jan-07
Mar-07
May-07
Jul-07
Sep-07
Nov-07
Jan-08
Mar-08
May-08
Jul-08
Sep-08
Nov-08
Jan-09
Mar-09
May-09
Jul-09
Sep-09
Nov-09
Jan-10
Mar-10
May-10
Jul-10
Sep-10
Nov-10
Jan-11
Mar-11
May-11
Jul-11
100,000
Imported Draft Volumes
YTD 2010 vs. YTD 2011 (gallons)
Country
BELGIUM
IRELAND
MEXICO
CANADA
GERMANY
UNITED KINGDOM
NETHERLANDS
ITALY
FRANCE
DENMARK
JAPAN
AUSTRIA
OTHERS
2010 YTD
9,963,387
9,889,758
3,982,284
8,817,107
4,282,341
5,495,625
3,252,848
828,480
190,585
165,271
12,245
70,863
522,804
2011 YTD
12,670,941
9,840,377
7,743,203
7,690,633
4,418,509
3,703,931
3,200,590
934,916
257,842
162,105
124,111
103,809
513,203
Volume
Change
2,707,555
-49,381
3,760,918
-1,126,475
136,168
-1,791,695
-52,258
106,437
67,257
-3,165
111,866
32,946
-9,601
Total
47,473,598
51,364,170
3,890,572
Percent
Change
27.2%
-0.5%
94.4%
-12.8%
3.2%
-32.6%
-1.6%
12.8%
35.3%
-1.9%
913.6%
46.5%
-1.8%
8.2%
2010 Draft Share of by State
10% < share
8%< share < 10%
0%< share<8%
Source: TTB and Beer Institute, 2011
US Average 9.7% in 2010
Almost 5 billion 16oz Servings
2010 Top 10 Largest Draft States
State
California
Pennsylvania
Florida
Texas
New York
Illinois
Wisconsin
Ohio
Colorado
Michigan
Top 10 States
Others
Total US
2010 Draft
Volumes (bls)
2,145,473
1,570,750
1,417,917
1,154,047
1,079,482
857,322
725,470
702,812
657,779
646,017
10,957,070
9,028,397
19,985,467
Draft
Share
9.7%
17.7%
11.2%
6.0%
10.4%
9.7%
15.0%
8.4%
18.5%
10.3%
10.4%
9.0%
9.7%
Change in Draft
Volumes
-6.8%
-2.1%
-2.8%
7.7%
2.3%
1.8%
-0.9%
-1.7%
7.3%
-7.3%
-1.2%
4.0%
1.1%
Top 10 Largest States have 55% of US Volume
Source: Beer Institute, 2011
Draft Volume Growth, 2010
Growth 4.0% to 20%
Growth -1.0% to +3.9%
Growth -1.1 to -15%
US Average +1.1%
Source: TTB and Beer Institute, 2011
Thank You
Beer Institute
Washington, DC
[email protected]

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