jueves, 1 de noviembre de 2007

The Agribusiness World Today

Ken Shwedel
Investigador de Agronegocios de Rabobank, México
15 - 19 de Octubre de 2007

The World

Creating a strong number 2 reshapes the marketplace:
That is what is happening in the U.S. beer market now that SABMiller and Coors announced that they would be combining their operations in that country. Together the new venture which unites the numbers two and three brewers in the U.S., will have about a 31 percent market share, but still behind Anheuser-Busch. Driving the venture was the need to adjust to a market characterized by "slower growth amid shifting consumer tastes." Yes, there are definite brand synergies, however, it seems that what was really attractive to the two companies is the expected $500 million in savings "by combining brewery networks...while also moving to eliminate identical corporate and marketing services." Interestingly, what the market is saying is that with this move Anheuser-Busch is now coming under pressure to make a move in the direction of an acquisition. No only is the competitive environment heating up, but also there are very few major real brewery targets available in the global consolidating beer market. This means that Anheuser-Busch better make their move and move fast.

Repositioning soy milk market in the Asian market: Of course soy milk consumption has been growing around the word, but it is in Asia where the market has really taken off, growing some 14 percent annually. What's behind the growth is not that soy is native to Asia but there has been a concerted effort to "reinvigorate sales in the category by launching new soy milk products as dairy alternatives and functional beverages." In other words, in the Asian market they are innovating and repositioning "the drink as a nutraceutical concept." This contrasts with other parts of the world where soy milk has been largely positioned as a beverage alternative for lactose intolerance individuals and/or as an organic -- as may be the case -- drink. Among other things in order to reposition the soy milk in Asian markets soy milk is now available fortified with "minerals, omega fatty acids and plant extracts." They have also developed new flavors, i.e. pomegranate flavored. Not being satisfied with a “regular” soybean, they have even innovated with a red bean soy drink. And if that is not enough they have even fortified the red soy drink.


Got milk: Over the first half of the year Mexico continued to be a major importer of dairy products. Imports grew across the board. The mix, though, over the last two years has changed favoring whey, cheese and butyric fats. At the same time domestic production, according to SAGARPA, has shown a slight increase. With what you would think are all these dairy products on the market, it would seem strange that the Economic Secretary is opening up import quotas. Apparently they are concerned that given the seasonality in milk production there may be a shortfall towards the end of the year. Politically they would rather face dairy farms angry about more imports than face angry consumers. Confronting the opening of the dairy sector in 2008 under NAFTA, dairy farmers, evidently, have come to recognize the fickle nature of the market place. They are promoting a plan to establish price stabilization fund.

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