Australia Food and Drink Report Q1 2012
Business Monitor International, November 2011, Pages: 118
Business Monitor International's Australia Food and Drink Report provides industry professionals and strategists, corporate analysts, food and drink associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Australia's food and drink industry.
The Queensland floods, a strong Australian dollar and declining consumer spending have darkened their Australian retail picture in 2011. BMI is holding on to a cautious outlook for the Australian consumer sector over 2011-2012 as BMI foresee a dip in private consumption, including retail spending, following a fall in domestic property prices that will lead to a loss of wealth. While there is little scope for optimism in Australia’s short-term consumer outlook, the long-term outlook for domestic consumer goods manufacturers and retailers is more upbeat. Australia’s healthy population growth and stable economic growth make for a reasonably positive-looking consumer picture.
Headline Industry Data
- 2011 per capita food consumption = +1.9%; CAGR forecast to 2016 = +0.9%.
- 2011 soft drinks sales = +3.4%; CAGR forecast to 2016 = +2.2%.
- 2011 alcoholic drinks sales = +1.7%; CAGR forecast to 2016 = +1.8%.
- 2011 mass grocery retail sales = +1.9%; CAGR forecast to 2016 = +3.5%.
Key Industry Trends
SABMiller Finally Wins Bid for Foster’s: In September 2011 UK brewing giant SABMiller finally sealed its acquisition for Foster's Group with an improved offer of AUD9.9bn (US$10.2bn), or AUD5.1 (US$5.2) per share, after it failed twice in its attempt to land Foster's with an offer of AUD4.9 (US$5.0) per share. Given SABMiller’s focus on strengthening Foster's brand positioning, improving supply chain management and reaping cost savings post-acquisition, BMI believe there is a strong cause for optimism in the UK brewer's turnaround strategy for Foster's. SABMiller CEO Graham Mackay commented during the company’s presentation on the acquisition of Foster's that there are premiumisation opportunities on offer in Australia as 'consumers move towards premium beers, craft beers and higher value lowercarbohydrate beers' and that the beer sector has continued to deliver 'long-term increases in profit and cash generation'
Aldi Takes Advantage of Private Label Demand: Domestic expansion is at the top of the agenda for German-based discount retailer Aldi's Australian business, whose product range largely consists of private labels. The retailer, which has 265 outlets in Australia, is expected to open between 25 and 30 stores in the country in 2012 and will be focusing its expansion on the eastern states of Australia. With domestic demand uncertainties lying ahead in 2011, Aldi is clearly looking to take advantage of a period of softened consumer confidence, which should work well for its lower-value offerings and private label goods. Over the longer term, the shift of consumption habits towards private labels will continue to pick up momentum, and Aldi should find itself better positioned to exploit this trend with an expanded domestic scale.
Risks To Outlook
With Chinese economic expansion set to slow in H211, BMI are concerned that further monetary tightening in China may dampen demand for Australian resources, particularly from mining, and force Australia’s full-year export growth into negative territory by 2012. BMI have long argued that, even if the Chinese economy continues to hold up, Australia's domestic woes mean that it is significantly at risk of a recession. The swing factor in determining whether Australia can escape outright contraction or recession, in their view, will be China's demand for Australian exports.
BMI Industry View
SWOT Analysis
Australia Food SWOT
Australia Drink SWOT
Australia Mass Grocery Retail SWOT
Business Environment
BMI’s Core Global Industry Views
Table: Food Prices, 2010 And 2011
Table: BMI’s Core Views For The Food & Drink Industry
Asia Pacific Risk/Reward Ratings
Table: China Food & Drink Risk/Reward Ratings – Q112
Table: Asia Pacific Food & Drink Risk/Reward Ratings – Q112
Australia Food & Drink Risk/Rewards Rating
Macroeconomic Outlook
Table: Australia – Economic Activity, 2006-2015
Industry Forecast Scenario
Consumer Outlook
Food
Food Consumption
Table: Food Consumption Indicators – Historical Data & Forecasts
Confectionery
Table: Food Sub-Sector Indicators – Historical Data & Forecasts
Table: Chocolate
Table: Sugar
Canned Food
Table: Food sub-sector indicators – Historical Data & Forecasts
Trade
Table: Australia Food & Drink Trade Indicators – Historical Data & Forecasts
Functional Food
Table: Functional Food
Drink
Alcoholic Drinks
Table: Australian Drinks Indicators – Historical Data & Forecasts
Table: Beer Trade, 2009-2015
Hot Drinks
Table: Australian Drinks Indicators – Historical Data & Forecasts
Soft Drinks
Table: Australian Drinks Indicators – Historical Data & Forecasts
Table: Carbonated Soft Drinks Trade, 2009-2015
Table: Fruit/Vegetable Juice Trade, 2009-2015
Mass Grocery Retail
Table: Australia MGR Sales By Format – Historical Data & Forecasts
Food
Key Industry Trends And Developments
Fonterra Leans On Higher-Growth Markets To Support Near-Term Growth
Ebro’s Failed Acquisition Of SunRice Disappointing For Both Parties
Australia Still Holds Attraction For Regional Food Players
Riding On The Health Awareness Trend
Market Overview
Food Processing
Functional Foods
Confectionery
Canned Food
Trade
Agriculture
Organic Farming
Drink
Key Industry Trends And Developments
SABMiller Wins Out To Take Control Of Foster’s
CCA Looks To Beer For Stronger Growth Prospects
Developed Market Potential Firmly In The Sights Of Regional Players
BMI Not Too Optimistic On TWE’s Near Term Growth
Growing Health Awareness Prompts Shifts In Production And Consumption Habits
Market Overview
Alcoholic Drinks
Beer
Wine
Hot Drinks
Soft Drinks
Mass Grocery Retail
Key Industry Trends And Developments
Australian Shoppers Turning To Private Labels
Shaky Fundamentals Prompt Aldi’s Expansion Move
Increasingly Challenging Year Ahead For Metcash
Metcash Succeeds In Bid For Franklins
Market Overview
Leading MGR Players
Table: Structure Of Australia's MGR Sector – Estimated Number Of Outlets
Table: Structure Of Australia's MGR Sector – Sales By Format, 2002-1010 (AUDbn)
Table: Value Of Sales Per Outlet Type, 2010
Table: Grocery Retail Sales Breakdown By Format, 2011 And 2010
Competitive Landscape
Consumer Share Price Analysis
Key Players
Table: Key Players in Australia's Food & Drink Sector
Table: Key Players in Australia's Mass Grocery Retail Sector
Company Monitor
Food
National Foods
Dairy Farmers
Heinz Australia
Cadbury
Drink
Lion Nathan
Foster’s Group
Coopers Brewery
Coca-Cola Amatil
Table: Strong 2010, Tough 2011 Ahead
Mass Grocery Retail
Aldi
Wesfarmers
FoodWorks
Woolworths
BMI Methodology
Food & Drink Business Environment Ratings
Table: Returns
Table: Risks
Weighting
Table: Weightings
BMI Food & Drink Industry Glossary
Mass Grocery Retail
BMI Food & Drink Forecasting And Sourcing
How We Generate Our Industry Forecasts
Sourcing
- National Foods
- Dairy Farmers
- Heinz Australia
- Cadbury
- Lion Nathan
- Foster’s Group
- Coopers Brewery
- Coca-Cola Amatil,
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