There's been a lot of talk about how, in an economic downturn, beer remains an affordable luxury.
The febrile repetitions of that phrase can seem like attempts at self reassurance. And the statement itself ignores the harsher conditions, and declining sales, in "emerging economy" nations.
Because beer is something of a luxury product in the emerging world, sales are more likely to fall in an economic slowdown, analysts said. Drinkers in poor countries can turn to less-expensive alternatives, including vodka in Russia, aguardiente in Latin America, and sorghum wine in China.
Sales of Beer Go Flat in Emerging Countries
Wall Street Journal
November 7, 2008
So what's a conglomerate producer of I.I.L.s (international light lagers) to do?
Declining growth in emerging markets raises the capital-intensive industry's need for purchasing power, which often comes through consolidation, said Petercam's Mr. Kippers [a securities firm in Belgium]. This year, InBev agreed to buy U.S. giant Anheuser-Busch Cos.
Analysts said they expect further consolidation, though the credit crunch could get in the way. SABMiller and Molson Coors Brewing Co., which formed a U.S. joint venture this year called MillerCoors, are among the most likely candidates to buy other brewers, analysts said. Among their possible targets: Foster's Group Ltd., of Australia. SABMiller is interested in buying Foster's beer operations
SABMiller/MolsonCoors/Fosters vs. ABIB (Anheuser-Busch InBev)?