Germany Food and Drink Industry Update Quarter 4 2011

  • August 2012
  • -
  • Business Monitor International
  • -
  • 125 pages

Germany’s impressive economic growth in the first portion of the year was driven primarily by strong domestic demand, encouraging us to raise our full-year Gross Domestic Product projection to 3.5% from 3.0% previously. The country’s fiscal position requires less drastic restructuring over the next five years than some of its regional neighbours, and there have been signs of optimism emerging from the retail segment . Germany was one of the strongest economic performers in 2010, and the results of the country’s leading retailers suggest that the consumer segment may be gathering legs. A trend away from discount stores could be emerging, with long-term implications for the country’s retail segment and consumption.



Headline Market Data
.. 2011 per capita food consumption = +2.6%; projection to 2015 = +10.0%
.. 2011 alcoholic drink revenues = -0.4%; projection to 2015 = +0.8%
.. 2011 soft drink revenues = +2.0% ; projection to 2015 = +7.5%
.. 2011 mass grocery retail revenues = +4.4%; projection to 2015 = +17.8%

Key Firms Trends
Germany Hit By E.coli Outbreak: Germany has been hit by an E. coli outbreak that has killed dozens and hit the produce segment badly. The outbreak of the E. coli strain, which was linked to fenugreek seeds imported from Egypt into Germany, left more than 4,300 people ill and 50 dead. The last case of illness linked to the outbreak was seen in early July, and health officials in Germany have declared that the outbreak has come to an end. Sales of fresh produce in a number of European industry s have been badly affected, with farmers’ federations estimating that growers were losing Euros 400mn on a weekly basis.
Asset Sale At Metro Could Fund Emerging Industries Cash & Carry Push: German retail giant Metro has recently revealed it is in talks regarding the possible disposal of is Real hypermarket chain. The firm is also reported to be considering a separate stock industry listing for its Kaufhof department store chain.
These two divisions generate around 17% and 5% of the firm’s total revenues respectively, but by offloading these businesses Metro could generate cash to invest in its cash and carry operations. These account for the bulk of its revenues and have greater potential to grow thanks to an increasing demand for the format in fast-growing emerging industries.

Key

Risks To Outlook
Eurozone Uncertainty: The risk of financial contagion and political uncertainty in Italy threaten to deepen the eurozone’s sovereign debt crisis and require substantially larger fiscal transfers on the part of the largest European economies. This could derail Germany’s plans to reduce net borrowing requirements for the state.
Export Competitiveness: A deteriorating global economic outlook and the prospect of major fiscal austerity across Europe in the near-to-medium term could see German exports underperform our current projections.

Table Of Contents

BMI Market View ... 7
Industry SWOT Analysis 9
Germany Food Industry Environment and Risk Analysis . 9
Germany Drink Industry Environment and Risk Analysis .. 10
Germany Mass Grocery Retail Industry Environment and Risk Analysis .. 11

Environment Overview . 12
BMI’s Core World Market Views .. 12
Data : BMI’s Core Views For The Food and Drink Market 19
Western Europe Food and Drink Risk/Reward Ratings .. 20
Data : Western Europe Food and Drink Risk/Reward Ratings - Q4 2011 . 24
Germany Food and Drink Business Environment Rating ... 25

Macroeconomic Data .. 26
Data : Economic Activity 28

Market Projection Scenario ... 29
Consumer Outlook ... 29
Food. 31
Food Consumption .. 31
Data : Food Consumption Indicators - Historical Data and Projections . 31
Confectionery.. 32
Data : Confectionery Value/Volume Sales - Historical Data and Projections .. 33
Drink 34
Soft Drinks And Bottled Water 34
Data : Soft Drinks Value Sales - Historical Data and Projections ... 35
Alcoholic Drinks . 36
Data : Alcoholic Drinks Value/Volume Sales - Historical Data and Projections . 37
Hot Drinks .. 38
Data : Hot Drinks Value Sales - Historical Data and Projections ... 39
Mass Grocery Retail 39
Data : Mass Grocery Retail Sales Value By Format - Historical Data and Projections .. 40
Trade ... 41
Food 42

Key Market Trends And Developments .. 42
Germany Hit By E.coli Outbreak 42
Convenience Hits The Spot In Germany . 42
German Organic Food Receives Boost After Dioxin Food Scandal . 43
Arla’s International Ambitions Come To Fruition With Germany’s Hansa-Milch ... 44
Dr Oetker Sells Onken Brand . 45
More Retailers Embracing Private Labels .. 46
Katjes Fassin Building European Presence In Sugar Confectionery ... 47
German Bakeries Hit Hard Times ... 48

Industry Analysis . 49
Food Segment 49
Prepared Food 50
Data : Frozen Fruit and Vegetables .. 50
Data : Snack Foods 52
Data : Pasta 55
Organic ... 56
Dairy ... 58
Data : Dairy ... 59
Data : Meat 64
Data : Fish .. 66
Data : Oils and Fats .. 69
Drink ... 75

Key Market Trends And Developments .. 75
Consolidation Moves In Soft Drinks ... 75
Carlsberg Sells German Brewery, Further Consolidation Likely 75
BMI Sees Merit Of CCE Expanding Into Germany . 77
Domestic Wine Demand Resilient ... 79

Industry Analysis . 80
Soft Drinks .. 80
Alcoholic Drinks . 81
Mass Grocery Retail .. 83

Key Market Trends And Developments .. 83
Asset Sale At Metro Could Fund EM Cash and Carry Push .. 83
Tengelmann Distances Itself From AandP In US ... 84
Grocery Retail Competition Probe Launched . 84
Discount Segment Faces Possible Resurgence From Supermarkets ... 85
Expansion Across Segments To Hedge Bets ... 86

Industry Analysis . 87
Data : Structure Of Germany’s Mass Grocery Retail Industry - Estimated Number Of Outlets ... 89
Data : Structure Of Germany’s Mass Grocery Retail Industry - Sales Format By Value (US$bn) ... 89
Data : Structure Of Germany’s Mass Grocery Retail Industry - Sales Format By Value (EURmn) . 89
Data : Annual Average Sales Per Outlet By Format - 2009 ... 89

Competition Overview 90
Data : Key Players In Germany’s Food Segment (2008) ... 90
Data : Key Players In Germany’s Drinks Segment (2008) . 92
Data : Key Players In Germany’s Mass Grocery Retail Segment ... 93
Company Monitor .. 95
Food. 95
Oetker Group .. 95
Nordmilch Group 97
Haribo 99
Lieken Group .100
Drink ...101
Emig GmbH and Co KG (GerberEmig Group) .101
Radeberger Group (Oetker Group)102
Anheuser-Busch InBev Germany ...103
Mass Grocery Retail ...104
Lidl Group .104
Rewe Group ...105
BMI Methodology 107
Food and Drink Business Environment Ratings 107
Ratings Methodology .107
Ratings Overview ...107
Ratings System ...107
Indicators ...107
Data : Limits Of Potential Returns 108
Data : Risks To Realisation Of Potential Returns ..109
Weighting ...110
Data : Weighting ...110
BMI Food and Drink Market Glossary 111
Food and Drink 111
Mass Grocery Retail ..111
BMI Food and Drink Projection ing And Sourcing ...113
How We Generate Our Market Projections 113
Sourcing .114

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