Caribbean Food and Drink Report Q2 2008
Business Monitor International, June 2008, Pages: 57
BMI's Caribbean Food Drink Report provides independent forecasts and competitive intelligence on Caribbean's food and drink industry.
Executive Summary:
With a substantial and costly food import dependency, an under-developed and under-financed agricultural sector, often-challenging inter-regional trade relationships, typically small populations and largely unspectacular economic growth – particularly in comparison to its South American peers – food and beverage investors could be forgiven for thinking that the Caribbean represents a weak investment opportunity. However, as BMI examines in its new Caribbean Food & Drink Report, unveiled for Q208, certain features of many of the islands’ food and beverage industries could actually prove highly attractive to investors – particularly experienced players willing to accept the limits of returns on offer.
One such attractive feature is the region’s increasingly developed modern retail industry. The spread of supermarkets and hypermarkets, particularly those large enough to manage their own import and distribution, have increased opportunities for the sale of branded food and beverages. While fresh food sold via these outlets may be less affordable to local residents, their scale does typically allow such stores to sell processed goods at lower prices than their independent rivals can manage. With BMI forecasting that the modern retail sector will grow at a double-digit rate in all six markets detailed in this report, the future looks bright for regional food and beverage investors in terms of distribution opportunities.
A second, immensely important investment consideration is the Caribbean’s thriving tourism industry. BMI estimates that the amount of tourists arriving in the Bahamas, Barbados, Puerto Rico, Trinidad & Tobago, Jamaica and the Dominican Republic alone in 2006 topped 9.4mn. This represents an enormous, primarily high-spending, audience at which to target food and beverage brands. In fact, the extent of the tourism sector in the Caribbean is such that investment in distribution and brand-building is valuable, even if there is no real receptive audience for goods among Caribbean residents themselves.
While the Caribbean’s food import dependency can be a weakness – pushing up the cost of food processing in the country – it can also be viewed as a strength having helped build a large and receptive audience for high-value, often US goods. This receptiveness has translated to a market in which a large proportion of food spending is committed to high-value foodstuffs, even though diets are still often traditional and per capita food consumption levels are typically low. For example, BMI estimates that 11.8% of Jamaica’s US$408mn food bill is spent on dairy products, while 11.5% goes towards beverages and tobacco products.
Of course the biggest pull for potential investors in the region will be its thriving beverages industry. Both the soft and alcoholic drink sectors have benefited from all of the above mentioned strengths to such an extent that the region now boasts a number of globally famous drinks brands. Such a global brand is perhaps unlikely to come out of the region’s less developed food sector, but that is not to detract from the promising growth opportunities that the Caribbean provides.
Executive Summary
Business Environment
SWOT Analysis
Mass Grocery Retail
Caribbean Mass Grocery Retail SWOT
Food and Drink
Caribbean Food & Drink SWOT
Macroeconomic Outlook
Barbados
Table: Barbados – Macroeconomic Forecasts
Dominican Republic
Table: Dominican Republic – Macroeconomic Forecasts
Jamaica
Table: Jamaica - Macroeconomic Forecasts
Puerto Rico
Table: Puerto Rico - Macroeconomic Forecasts
Trinidad & Tobago
Table: Trinidad & Tobago – Macroeconomic Forecasts
Retail
Regional Overview
Table: Total Sales via Grocery Retail Outlets in Selected Caribbean Markets* (US$mn) – Historical Data
Table: Total Sales via Grocery Retail Outlets in Selected Caribbean Markets* (US$mn) – Forecasts
Bahamas
Market Overview
Industry Forecast Scenario
Barbados
Market Overview
Industry Forecast Scenario
Dominican Republic
Market Overview
Industry Forecast Scenario
Jamaica
Market Overview
Industry Forecast Scenario
Puerto Rico
Market Overview
Industry Forecast Scenario
Trinidad & Tobago
Market Overview
Industry Forecast Scenario
Industry Developments
Food And Drink
Agriculture
Regional Overview
Table: Trinidad & Tobago – Production (‘000 tonnes) of Leading Agricultural Commodities
Table: Jamaica – Production (‘000 tonnes) of Leading Agricultural Commodities
Table: Dominican Republic – Production (‘000 tonnes) of Key Agricultural Commodities
Table: Barbados – Production (‘000 tonnes) of Key Agricultural Commodities
Food
Regional Overview
Table: Food Spending Breakdown by Product Category in Selected Caribbean Markets (US$mn), 2006
Table: Caribbean Imports (US$mn) of Agri-food Goods from the US, 2006
Industry Forecast Scenario
Table: Food Consumption in Selected Caribbean Markets
Table: CARICOM Trade Balance (US$mn) – Food & Live Animals For Food Purposes
Industry Developments
Drink
Regional Overview
Table: Caribbean Tourism (stop-over) Arrivals, 2006
Industry Forecast Scenario
Table: Trinidad & Tobago Beverage Production by Category – Historical Data & Forecasts
Table: Jamaica Beverage Production by Category - Historical Data & Forecasts
Industry Developments
Tobacco
Regional Overview
Industry Forecast Scenario
Table: Caribbean Cigarette Production and Consumption Data
Industry Developments
Competitive Landscape.
Key Players
Mass Grocery Retail
Table: Key Players – Caribbean Mass Grocery Retail Operators
Drink
Table: Key Players in the Caribbean Drinks Market, 2006
Food
Table: Key Players in the Caribbean Food Market, 2006
Company Analysis
Mass Grocery Retail
Wal-Mart (Puerto Rico
Supermercados Nacional (Dominican Republic)
Food
Seprod Ltd (Jamaica)
Drink
Jamaica Drink Company (Jamaica)
Red Stripe (Jamaica)
BMI Forecast Modelling
How We Generate Our Industry Forecasts
Food and Drink Industry
Sources
Wal-Mart (Puerto Rico
Supermercados Nacional (Dominican Republic)
Seprod Ltd (Jamaica)
Jamaica Drink Company (Jamaica)
Red Stripe (Jamaica)
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