Archives

The new Asian tiger

Rob McCaig, Managing Director and Director of Brewing, Canadian Malting Barley Technical Centre (CMBTC)

China leads the charge as Asia takes top position in the new world order of beer production. A look at four key trends and what they mean for the future.

Big changes are brewing on the international beer production scene. While Canada and most other industrialized nations are declining in production, Asia is more than making up for that deficit - with double digit growth that is propelling a steady rise in world beer production.

What does this mean for Canada in the world malting barley trade? Rob McCaig of the Canadian Malting Barley Technical Centre (CMBTC) broke down the changes in a presentation at the 2005 North American Barley Researchers Workshop (NABRW) in Red Deer, Alta.

Following the session, he spoke with Land and Science about four key trends. Here are highlights of the conversation:

1. China fuels Asian rocket

Asia is the new global king of beer production, and China is leading the way. The monolithic country produces 64 percent of the beer produced in Asia and has experienced double-digit growth in this production for the past five years.

"There is a tremendous amount of change taking place in the brewing industry," says McCaig. "Most of the industrialized nations, including Canada, have been declining in production, but the slack is being taken up by Asia and South America."

Overall, world beer production is growing at a steady pace, he says, from 1.21 billion hectolitres in 1994 to 1.48 in 2003. Along with China, other notable countries for production growth include Vietnam, India, Mexico, Columbia and Russia.

2. Consumption on the rise

Spurring the global rise in beer production is a similar rise in consumption. World beer consumption has increased steadily from 116 billion litres in 1993 to 150 billion litres in 2005. Among countries, long-time leader the U.S. remains the top consumer, with 23.82 billion litres consumed in 2002. But China is hot on its heals with a dramatic rise to 23.49 billion litres consumed that same year.

"On a per capita basis, beer consumption in China has gone up quite a bit, but is still relatively low," notes McCaig. "The driving force behind China's rising consumption has been its increasing population."

McCaig tests new malting barley varieties at CMBTC in Winnipeg.

3. Emergence of 'supercompanies'

Another hallmark of beer production today is massive consolidation among brewers, says McCaig. Today, the top four brewers - Interbrew, SABMiller, Anheuser-Busch and Heinekin - produce approximately 30 percent of the world's beer, and that percentage is rising as the big brewers continue to merge and buy up smaller brewers.

"The brewing world continues in a major consolidation phase, where bigger is better - it's more economical and its essential to maintain strong global brands," says McCaig. "In the future, we see the number of large brewers shrinking still further into a handful of supercompanies."

The malting production sector is also going through broad consolidation.

4. Canada's opportunity

As for what these big picture shifts mean for Canada in the malting barley trade, McCaig says everything points to strong opportunity.

"Beer production is a market that recognizes quality in barley, and Canada has a strong reputation for producing high quality malting barley," he says. "The world malting barley trade has risen from just under 5,000 million tonnes in 2000, to over 5,600 MT today, and it's expected to further increase to around 6,400 MT by 2011. There is solid potential in those growing numbers for Canada to improve its opportunity for generating higher returns for its barley crop"

© 2005 Meristem Information Resources Ltd.
Meristem® is a registered trademark of Meristem Information Resources Ltd. All rights reserved.
Legal Disclaimer