vladimir balach, generalsecretaryof cbma · ČeskÝ svaz pivovarŮ a sladoven czech beer and malt...
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Czech Beer and Malt Association
• CBMA represents interests of breweries, malt houses and other suppliers and partners in beer sector
• One of the oldest beer associations in Europe
• Former “Society for beer industry in Czech Kingdom was established in 1873
• CMBA Ethical code and self-regulation process
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Breweries in the Czech market
• Czech beer market is diversified represented by breweries of all sizes from large international brewers to small local breweries
• 6 large brewing companies (Pilsner Urquell, Staropramen Brewery, Heineken, Budweiser Budvar, Lobkowitz Brewery, Moravian-Silesian Brewery)
• 27 individual small to mid-size breweries
• Boom of mini and restaurant breweries – in 2012 there were registered approximately 160
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Current situation on beer domestic market
• The brewing industry, affected by the economic crisis, has faced an
unprecedented decline in beer output following the excise tax increase
• After two years of significant decline in total production this trend stopped
in 2011
• In 2012 total beer production increased slightly by 2,75%
• Production for the domestic market increased only by 1,4 %, fueled mostly
by beer mixes growth
• Malt production copies trend of beer 2012 – 526 kt
• Hops production est. 2013 – 4 700 t
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Structure of breweries in the Czech market
0
50
100
150
200
250
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Yearly production ≤ 1.000 hl
Production > 1.000 hl and ≤ 50.000 hlProduction > 50.000 hl and ≤ 200.000 hl Production >200.000hl
Total number ofbreweries
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Structure of breweries in the Czech market
Breweries in the Czech Republic 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Total number of breweries
(including microbreweries) 89 90 91 100 126 128 133 151 191 213
Number of brewing companies
Yearly production ≤ 1.000 hl
(microbreweries) 35 36 36 41 66 57 51 65 90 20
Yearly production > 1.000 hl and ≤
50.000 hl 18 18 15 20 22 31 49 48 70 158
Yearly production > 50.000 hl and
≤ 200.000 hl 16 16 18 19 19 20 8 12 9 11
Yearly production > 200.000hl9 9 10 10 9 7 8 10 8 8
Total number of brewing
companies 78 79 79 90 116 115 116 135 177 197
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Total beer production in the Czech Republic
9.245
11.418
16.27617.475
19.198
17.924
19.787 19.897 19.80618.637
16 180* 16 705*
18.591
176
129
104
7971
5748 47 47 47 47 47 47
0
20
40
60
80
100
120
140
160
180
200
0
5.000
10.000
15.000
20.000
25.000
1950 1960 1970 1980 1990 2000 2006 2007 2008 2009 2010 2011 2012
Beer production in thousands hl Number of active breweries
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Beer production for domestic market
-0,3%
1,6%2,0%
1,1%1,7%
3,8%
0,1%
-0,5%
-5,9%
-8,6%
2,6%
1,4%
-10,0%
-8,0%
-6,0%
-4,0%
-2,0%
0,0%
2,0%
4,0%
6,0%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Trends Czech malting industry (in kt)
166
281
314
351
428
475
521 528541
518499
522 526
83
141
114 106
148
208
263
233244 244 241
279
258
0
100
200
300
400
500
600
1950 1960 1970 1980 1990 2000 2006 2007 2008 2009 2010 2011 2012
Production Export
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Surface hop-field and hop production in the Czech republic
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
10 000
11 000
12 000
13 000
14 000
15 000
Hop production (t)
Surface hop-field (ha)
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Market development, change in consumer demand
• The long tradition of drinking almost only lagers in the CzechRepublic has changed. It was built on the traditions of the famousCzech brewing, dominated by the pilsner-type lager.
• In the last few years, consumer demand has evolved. One of thetrends is a shift from the HORECA segment towards in-home-consumption.
• The group of older consumers still prefers Czech lager as thedominant type of beer. The pub is the preferred style of socializingfor them.
• Younger consumers prefer a variety of choices: variety in beveragechoice, variety in packaging for different occasions anddifferentiated consumer experience.
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Beer consumption per capita (in liters)
159
156
158,8
160,9
157,9
156,5
158,1158,8
154
144 144145
144
135
140
145
150
155
160
165
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Consumption of beer across distribution channels
51%43%
49% 57%
0%
10%
20%30%
40%
50%
60%70%
80%
90%100%
2009 2012
On-trade Off-trade
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Consumption by type of beer
54,89%
38,05%
7,06%
2012
Tap beer
Lagers
Other
62,30%
32,60%
5,10%
2009
Tap beer
Lagers
Other
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Consumption of Czech beer among tourists
While Czechs drink at average one small beer a day (0,3l), tourists drink almost two large beers a day (0,9l)
∅∅∅∅ Tourists consumption of beer (L/person/day) Tourists consume in the Czech Republic in total 40 million large beers (20 mil. liters)
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Overall impact of Czech brewing sector
SUPPLIERS
• Farmers• Utility • Construction industry• Chemical industry• Logistics services• Etc.
BREWERIES
• Microbreweries• Minibreweries• Large breweries• Malt producers
HORECA +
RETAIL
• Pubs• Restaurants• Cafes• Retail• Wholesale• ChainsC
ZK 2
5bn
Ta
x p
aym
ents
55,000 employees
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
� 7,600 employees directly employed in the brewing sector *
� 90 – 95%of raw materials come from Czech Republic
� Support for Czech farmers – barley, hops
Czech beer brewed using Czech ingredients
� Beer for the czech market produced exclusivelywithin Czech Republic
*SOURCE 12: The Contribution made by Beer to the European Economy (Full Report – Edition 2009) prepared by Ernst & Young (pp. 55, 57 and 59)
Direct impact of Czechbrewingsector
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
� 12,500 indirect employees* at SUPPLIERS
� 34,600 employees in HORECA and RETAIL* sectors
� CZK14bln payments go to suppliers fromCzech brewing sector (91% of the amount stays in Czech republic*)
� The largest portion of revenue fromsales in HORECA (25%) is frombeer (hotels, restaurants, cafés)
*SOURCE 12: The Contribution made by Beer to the European Economy (Full Report – Edition 2009) prepared by Ernst & Young (p.55)
Indirect impact of Czechbrewingsector
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
CZK 10,8bn - to the State Budget � Excise tax, VAT, legal entities tax, employees
income tax, other*
CZK 6,8bn - indirect tax-related revenues � Through suppliers sector*
Contributionof Czechbrewingsector
*SOURCE 12: The Contribution made by Beer to the European Economy (Full Report – Edition 2009) prepared by Ernst & Young (pp. 55, 57 and 59)
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Czech Beer and Malt Association (CBMA)INITIATIVE
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Protected geographical indication Czech beer
• PGI Czech beer registered in 2008• Used by 16 breweries for 77 beer trademarks• Strict control of compliance with many requirements, e.g.
– 80 % of malt pouring per brewing is made of spring barley of recommended sorts
– 30 % of hops per brewing has to be hops from Žatec and its recommended clones etc.
Main benefits:
• Quality guarantee for consumers• Protection against bad competition• Guarantee of stable demand for raw material suppliers• Support of export and tourism
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
New research on composition of Czech beer from VÚPS
• Screening of selected health beneficial substances in Czech andforeign beers
• Compared representation of controlled substances in Czech andforeign lagers
Czech beer contains elevated concentrations of:
• B vitamins
• oligosaccharides and higher dextrins
• polyphenolic substances
• bitter substances
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Czech Beer &Malt Association (CBMA) Ethical Code
CBMA Ethical Code▪ More strict than national self-regulation code
Self-regulation process▪ Complaint is given by any brewery▪ RBI give the recommendation to the Presidium of
CBMA▪ The decision should be done until 10 days▪ If doubts the last arbiter is National self-regulatory
body
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
As long as I drive, I drink non-alcoholic beer !Project scope
▪Czech Beer and Malt Association (CBMA)signed Memorandum about cooperationwith Czech Police▪Objective of cooperation is related to the
traffic safety improvement, especially in thearea of drinking and driving▪CBMA members together with police award
„responsible drivers“
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Czech beer market in a nutshell and treasure
• Beer is an important part of Czech Culture
• We take pride in it both at home and abroad
• More than 2/3 of all beers produced worldwide are of Czech, the “Pils” type
• Increased choices for consumers, but with constantly high quality and taste richness
• Development of beer domestic market is limited by the high consumption (expected gentle decline)
• Czech beer is one of the pillars of the Czech Republic brand
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CZECH BEER AND MALT ASSOCIATIONČESKÝ SVAZ PIVOVARŮ A SLADOVEN
Czech Republic brand pillars
Skoda
Ice-hockey
Czech beer
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