Venezuela Food and Drink Report Q3 2008
Business Monitor International, July 2008, Pages: 52
The Venezuela Food and Drink Report provides independent forecasts and competitive intelligence on Venezuela's food and drink industry.
Over the past two years the alcoholic drinks industry in Venezuela has been under attack from the country’s President Hugo Chávez, as discussed in this newly published Q308 Venezuela Food & Drink Report. Chávez, who claims to rarely drink, has introduced a raft of new taxes and made it more difficult for importers to access the US dollars they need to purchase brand name spirits from multinational firms. Despite these moves, alcohol consumption continues to rise at both ends of the socio-economic spectrum. However, expects these anti-alcohol measures to eventually have a negative effect on this rate of growth.
Chávez has attacked the lack of morals in Venezuela’s society and raised concerns that too many Venezuelans swill beer on street corners. Chávez began his crusade against the alcohol industry by banning beer trucks that traditionally acted as mobile markets selling beer in the country’s poorer neighbourhoods. The Venezuelan beer industry is dominated by local firm Empresas Polar S.A. which controls around 80% of the market. Another local firm Cervecería Regional controls around 12% of the market, while multinational brewer InBev controls around 7%.
In October 2007 Chávez stepped up his campaign against alcohol by announcing a substantial increase in the tax charged on beer and spirits. In addition Chávez announced that stores near schools, churches and cultural centres would not be allowed to sell alcohol and that the government would no longer make government dollars available to import luxury spirits such as whiskies. With dollars on the black market changing hands for twice the official exchange rate this policy would significantly increase the price consumers are forced to pay for imported spirits.
Venezuela has the highest per capita beer consumption rate in Latin America and despite these measures designed to curb consumption sales continue to climb. Between 2002 and 2007 consumption in volume terms increased by 13% however this report is forecasting that the additional taxes, plus continued measures to reduce sales outlets will eventually take their toll and this rate of growth is expected to slow down over the next five years.
Venezuela is also a big consumer of spirits, with whiskey particularly popular. According to the Scotch Whiskey Association Venezuela is currently the fifth biggest market for Scotch in the world, however if prices are pushed up substantially demand in this sector is also likely to decline. This report is therefore forecasting that consumption of spirits in volume terms will increase by only a modest 7% over the next five years and that consumption of imported luxury spirits may actually start to decline.
Executive Summary 5
Business Environment 6
Regional Food & Drink Business Environment Ratings 6
Table: Latin America Food & Drink Business Environment Ratings – Q308 8
Venezuela’s Food & Drink Business Environment Rating . 9
Table: Global Food & Drink Business Environment Ratings – Venezuela’s Peer Group 10
SWOT Analysis 11
Food And Drink 11
Venezuela Food And Drink Industry SWOT 11
Mass Grocery Retail 12
Venezuela Mass Grocery Retail Industry SWOT 12
Macroeconomic Outlook 13
Table: Venezuela Economic Activity 14
Food 15
Industry Forecast Scenario 15
Food Consumption 15
Table: Venezuela Food Consumption Indicators – Historical Data & Forecasts 16
Confectionery 16
Table: Confectionery Value/Volume Sales – Historical Data & Forecasts 17
Industry Developments 17
Market Overview 20
Food Production 20
Prepared Food / Canned Food 20
Dairy 21
Meat 22
Seafood 22
Drink 23
Industry Forecast Scenario 23
Hot Drinks 23
Table: Hot Drink Value Sales – Historical Data & Forecasts 23
Alcoholic Drinks 23
Table: Alcoholic Drink Value/Volume Sales – Historical Data & Forecasts 24
Soft Drinks 24
Table: Soft Drink Value/Volume Sales – Historical Data & Forecasts 24
Industry Developments 24
Market Overview 25
Alcoholic Drinks 25
Soft Drinks 25
Agriculture At A Glance 27
Table: Venezuela Dairy Industry Data (‘000 Tonnes, Unless Stated) 27
Table: Venezuela Organic Agricultural Data, 2006 27
Table: Venezuela Rural/Urban Population Breakdown 27
Agricultural Commodity Price 28
Mass Grocery Retail 29
Industry Forecast Scenario 29
Table: Venezuela Mass Grocery Retail – Value Sales By Format (US$bn) – Historical Data & Forecasts 30
Table: Sales Breakdown By Retail Format Type – 2007 & 2017 30
Industry Developments 31
Market Overview 32
Table: Structure Of Venezuela's Mass Grocery Retail Market By Estimated Numbers Of Outlets 34
Table: Structure Of Venezuela's Mass Grocery Retail Market – Sales Value By Format (US$bn) 34
Competitive Landscape 35
Key Players 35
Food And Drink 35
Table: Key Players In Venezuela's Food & Drink Sector, 2007 35
Mass Grocery Retail 36
Table: Key Players In Venezuela's Mass Grocery Retail Sector, 2007 36
Company Analysis 37
Food 37
Alimentos Heinz CA 37
Cargill de Venezuela 38
Empresas Polar 39
Drink 40
Coca-Cola FEMSA 40
Pernod Ricard Venezuela 41
Mass Grocery Retail 42
Mercal CA 42
Makro Venezuela 43
Appendix 44
Food & Drink Business Environment Ratings 44
Ratings Methodology 44
Ratings Overview 44
Ratings System 44
Indicators 44
Limits Of Potential Returns 45
Risks To Realisation Of Potential Returns 46
Weighting 47
Weighting 47
BMI Food & Drink Industry Glossary 48
Food & Drink 48
Mass Grocery Retail 48
BMI Food & Drink Forecasting & Sourcing 50
How We Generate Our Industry Forecasts 50
Sourcing 51
- Alimentos Heinz CA
- Cargill de Venezuela
- Empresas Polar
- Coca-Cola FEMSA
- Pernod Ricard Venezuela
- Mercal CA
- Makro Venezuela
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