Soft Drinks in Belarus

Report Summary

Discover the latest market trends and uncover sources of future market growth for the Soft Drinks industry in Belarus with research from Euromonitor's team of in-country analysts.

Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.

The Soft Drinks in Belarus market research report includes:

• Analysis of key supply-side and demand trends
• Detailed segmentation of international and local products
• Historic volumes and values, company and brand market shares
• Five year forecasts of market trends and market growth 
• Robust and transparent market research methodology, conducted in-country

Our market research reports answer questions such as:

• What is the market size of Soft Drinks in Belarus?
• What are the major brands in Belarus?
• What potential exists for multinational vs. local soft drinks companies looking to increase market share?
• How have changing social attitudes affected soft drink sales?
• How have sustainability issues; such as environmentally-friendly packaging, legislation on recyclability, or the amount of plastic in bottles, affected the soft drink industry?

Why buy this report?

• Gain competitive intelligence about market leaders
• Track key industry trends, opportunities and threats
• Inform your marketing, brand, strategy and market development, sales and supply functions

This industry report originates from Passport, our Soft Drinks market research database.

EXECUTIVE SUMMARY

Volume growth in spite of the economic crisis

In 2011, Belarus was facing an economic crisis. The prices of soft drinks rose by nearly 50% during the first half of the year compared to prices in December 2010, according to national statistics. This was due to a significant 42% devaluation of the national currency on 24 May 2011, as well as ongoing currency devaluation throughout the year. Price inflation was expected to be even higher for the whole of 2011, with Belarus expected to become a world leader in terms of price growth that year. The hot summer drove soft drinks volume growth of 7% in spite of the economic crisis.

Government plans to develop bottled water manufacturing over 2011- 2015

Belarus has unique natural water resources, most of which are natural spring mineral waters. This offers good opportunities for the development of sanatorium and spa water treatments as well as the increasing production of bottled water for sale both domestically and for export. The government has plans to increase the extraction of underground water. To achieve this goal, from 1 July 2011, a new national standard (STB2171-2011) for bottled mineral water came into force, aiming to bring Belarus into line with international standards.

Belarus plans to attract foreign investment

The government plans to attract foreign investment in water extraction and bottling over the forecast period in order to develop the country’s natural water resources. This investment will fund the building of new plants for bottled mineral and drinking water. Two new production sites have already opened in the Minsk region following a total investment of €26 million. According to the business plan, the commission of new production facilities is expected in late 2013, with 70% of products expected to be exported. Currently, locally produced bottled mineral and drinking water is mainly sold in Belarus. The market in Belarus is getting close to saturation so the country needs to consider its export potential. Taking into account the world’s lack of clean water, Belarusian exports of bottled water are deemed to have significant potential.

Crisis strengthens local manufacturers’ dominant positions in soft drinks

A significant currency crisis hit Belarus in 2011. Leading local manufacturers used the crisis as an opportunity to increase their shares in the market at the expense of imported brands. The 2011 crisis resulted in a shortage of foreign currencies, as well as in a sharp devaluation of the ruble. This led to higher unit price growth for imported brands, which, together with the decreasing purchasing power of the majority of consumers in Belarus, helped local products gain stronger volume shares.

The soft drinks industry in Belarus has always been characterised by the leadership of local players. The shares of imported bottled water and carbonates were traditionally low, although fruit/vegetable juice was dominated by imported products until 2009. From 2009, locally produced fruit/vegetable juice gained a larger retail volume share than imported brands, and has continued to gain share steadily since. In 2011, local juice manufacturers had the opportunity to increase their volume shares “thanks” to the currency crisis.

Market to see positive growth

The major soft drinks categories of carbonates, bottled water and fruit/vegetable juice are expected to experience total volume and value sales growth over the forecast period, albeit generally at a slower rate than over the review period due to the economic crisis, as well as the fact that they are approaching maturity. The most dynamic volume CAGR of 5% over the forecast period is expected from fruit/vegetable juice, while bottled water volume sales will grow by 4% annually and carbonates by 3%. Total value sales are set to grow faster than total volume sales due to rising unit prices caused by high inflation.

Table of Contents

Soft Drinks in Belarus - Industry Overview

EXECUTIVE SUMMARY
Volume growth in spite of the economic crisis
Government plans to develop bottled water manufacturing over 2011- 2015
Belarus plans to attract foreign investment
Crisis strengthens local manufacturers’ dominant positions in soft drinks
Market to see positive growth

MARKET DATA
Table 1 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: Volume 2006-2011
Table 2 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: % Volume Growth 2006-2011
Table 3 Off-trade vs On-trade Sales of Soft Drinks by Channel: Value 2006-2011
Table 4 Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value Growth 2006-2011
Table 5 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: Volume 2010
Table 6 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: % Volume 2010
Table 7 Off-trade vs On-trade Sales of Soft Drinks by Category: Value 2010
Table 8 Off-trade vs On-trade Sales of Soft Drinks by Category: % Value 2010
Table 9 Off-trade Sales of Soft Drinks (as sold) by Category: Volume 2006-2011
Table 10 Off-trade Sales of Soft Drinks (as sold) by Category: % Volume Growth 2006-2011
Table 11 Off-trade Sales of Soft Drinks by Category: Value 2006-2011
Table 12 Off-trade Sales of Soft Drinks by Category: % Value Growth 2006-2011
Table 13 Company Shares of Off-trade Soft Drinks (as sold) by Volume 2007-2011
Table 14 Brand Shares of Off-trade Soft Drinks (as sold) by Volume 2008-2011
Table 15 Company Shares of Off-trade Soft Drinks (RTD) by Volume 2007-2011
Table 16 Brand Shares of Off-trade Soft Drinks (RTD) by Volume 2008-2011
Table 17 Company Shares of Off-trade Soft Drinks by Value 2007-2011
Table 18 Brand Shares of Off-trade Soft Drinks by Value 2008-2011
Table 19 Off-trade Sales of Soft Drinks by Category and Distribution Format: % Analysis 2011
Table 20 Forecast Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: Volume 2011-2016
Table 21 Forecast Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: % Volume Growth 2011-2016
Table 22 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: Value 2011-2016
Table 23 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value Growth 2011-2016
Table 24 Forecast Off-trade Sales of Soft Drinks (as sold) by Category: Volume 2011-2016
Table 25 Forecast Off-trade Sales of Soft Drinks (as sold) by Category: % Volume Growth 2011-2016
Table 26 Forecast Off-trade Sales of Soft Drinks by Category: Value 2011-2016
Table 27 Forecast Off-trade Sales of Soft Drinks by Category: % Value Growth 2011-2016

APPENDIX
Fountain sales in Belarus

DEFINITIONS

SOURCES
Summary 1 Research Sources

Soft Drinks in Belarus - Company Profiles

Darida PChUP in Soft Drinks (Belarus)
STRATEGIC DIRECTION
KEY FACTS
COMPANY BACKGROUND
PRODUCTION
Summary 3 Darida PChUP: Production Statistics 2010
Summary 4 Darida PChUP: Production Statistics for January-June 2011
COMPETITIVE POSITIONING
Summary 5 Darida PChUP: Competitive Position 2011

MZBN (Minsky Zavod Bezalcoholnyh Napitkov) in Soft Drinks (Belarus)
STRATEGIC DIRECTION
KEY FACTS
COMPANY BACKGROUND
PRODUCTION
Summary 8 MZBN (Minsky Zavod Bezalcoholnyh Napitkov): Production Statistics 2010
Summary 9 MZBN (Minsky Zavod Bezalcoholnyh Napitkov): Production Statistics January – June 2011
COMPETITIVE POSITIONING
Summary 10 MZBN (Minsky Zavod Bezalcoholnyh Napitkov): Competitive Position 2011

Bottled Water in Belarus - Category Analysis

HEADLINES

TRENDS
Belarus has considerable mineral and spring water resources for both drinking water and balneotherapy in health resorts, as well as for sales of bottled water under various brand names. Belarus has currently explored 227 sites for mineral water. Their overall operational reserves are 21.2 million m3 per year. Of the 227 sites, 121 are used for sanatorium treatments and the bottling of mineral water. In Belarus, there are 83 health centres and sanatoriums at which mineral water is used to treat different diseases.

COMPETITIVE LANDSCAPE
All the leading brands in bottled water in Belarus are locally produced, for example Darida (Darida PChUP), Minskaya (MZBN), Frost (Frost & Co) and Bonaqua (Coca-Cola Beverages Belarus). The entrance of new players over the forecast period is possible due to the latest government plans to develop bottled water production and increase exports, but only with the help of foreign investors. Therefore, the leading players are expected to continue to exploit growth opportunities and lead the category.

PROSPECTS
Bottled water in Belarus is expected to post a total volume CAGR of 4% over the forecast period, which will be weaker than the 7% CAGR recorded over the review period. The predicted slowdown will be due to the economic crisis.

CATEGORY DATA

Institutional Bottled Water Sales
Table 28 Sales of Bottled Water to Institutional Channel 2006-2011
Table 29 Off-trade Sales of Bottled Water: Volume 2006-2011
Table 30 Off-trade Sales of Bottled Water: Value 2006-2011
Table 31 Off-trade Sales of Bottled Water: % Volume Growth 2006-2011
Table 32 Off-trade Sales of Bottled Water: % Value Growth 2006-2011
Table 33 Company Shares of Bottled Water by Off-trade Volume 2007-2011
Table 34 Brand Shares of Bottled Water by Off-trade Volume 2008-2011
Table 35 Company Shares of Bottled Water by Off-trade Value 2007-2011
Table 36 Brand Shares of Bottled Water by Off-trade Value 2008-2011
Table 37 Forecast Off-trade Sales of Bottled Water: Volume 2011-2016
Table 38 Forecast Off-trade Sales of Bottled Water: Value 2011-2016
Table 39 Forecast Off-trade Sales of Bottled Water: % Volume Growth 2011-2016
Table 40 Forecast Off-trade Sales of Bottled Water: % Value Growth 2011-2016

Carbonates in Belarus - Category Analysis

HEADLINES

TRENDS
Sales of carbonates are heavily dependent on the weather during the summer in Belarus. The country’s hot summer weather usually stimulates sales between May and September. In 2011, the summer in Belarus was one of the hottest and boosted sales in spite of the currency crisis. Global warming trends, including milder winters, could weaken the seasonality of demand over the long term.

COMPETITIVE LANDSCAPE
In 2011, Coca-Cola Beverages Belarus led sales of carbonates with a 31% share of off-trade volume sales and a 33% share of off-trade value sales. This position derives from its 18% off-trade volume share in non-cola carbonates and impressive 70% share in cola carbonates. Since 1994, when the company entered Belarus by opening its own manufacturing plant, it has developed its own infrastructure, allowing timely delivery on a national scale. The company also spends heavily on frequent advertising and promotions. Perhaps surprisingly, given its foreign origin, it has received strong support from the Belarusian authorities. Coca-Cola Beverages benefits from the strong recognition and popularity of its major Coca-Cola, Sprite and Fanta brands. To compete in the price-sensitive Belarusian market, the company has also manufactured the cheaper brand Fruit Time since 2004. The company also focuses on the distribution of its products. One of its main targets is to develop a presence in every retail outlet in Belarus. To achieve this goal, it annually invests US$2 million in fridges and other trade equipment for retailers.

PROSPECTS
Over 2011-2016 carbonates is forecast to register a total volume CAGR of 3% and a constant value CAGR of 5%. In total volume terms, growth is anticipated to be slightly lower than that of the review period. This will be due to the economic crisis in Belarus as well as the category moving towards saturation.

CATEGORY DATA

Table 41 Low Calorie Carbonates by Category
Table 42 Off-trade Sales of Carbonates by Category: Volume 2006-2011
Table 43 Off-trade Sales of Carbonates by Category: Value 2006-2011
Table 44 Off-trade Sales of Carbonates by Category: % Volume Growth 2006-2011
Table 45 Off-trade Sales of Carbonates by Category: % Value Growth 2006-2011
Table 46 On-trade vs Off-trade Sales of Carbonates: Volume 2006-2011
Table 47 On-trade vs Off-trade Sales of Carbonates: Value 2006-2011
Table 48 On-trade vs Off-trade Sales of Carbonates: % Volume Growth 2006-2011
Table 49 On-trade vs Off-trade Sales of Carbonates: % Value Growth 2006-2011
Table 50 Company Shares of Carbonates by Off-trade Volume 2007-2011
Table 51 Brand Shares of Carbonates by Off-trade Volume 2008-2011
Table 52 Company Shares of Carbonates by Off-trade Value 2007-2011
Table 53 Brand Shares of Carbonates by Off-trade Value 2008-2011
Table 54 Forecast Off-trade Sales of Carbonates by Category: Volume 2011-2016
Table 55 Forecast Off-trade Sales of Carbonates by Category: Value 2011-2016
Table 56 Forecast Off-trade Sales of Carbonates by Category: % Volume Growth 2011-2016
Table 57 Forecast Off-trade Sales of Carbonates by Category: % Value Growth 2011-2016

Concentrates in Belarus - Category Analysis

HEADLINES

TRENDS
Concentrates are seen as old-fashioned beverages in Belarus. This is due to their presence since Soviet times and because such products are cheap and mainly consumed by people in rural areas. Only powder concentrates are available in the country. Low unit prices continued to support retail volume sales over the review period.

COMPETITIVE LANDSCAPE
In 2011, Krinitsa remained the leading company in powder concentrates with an off-trade volume share of 47% and an off-trade value share of 48%. The company’s leading position can be attributed to its popularity as a producer of beer and carbonates. There are only two main manufacturers of powder concentrates. Krinitsa is by far the biggest, which gives it a competitive advantage.

PROSPECTS
Over the forecast period powder concentrates is expected to post a 2% off-trade volume CAGR decline.

CATEGORY DATA

Concentrates Conversions
Summary 11 Concentrates Conversion Factors for Ready-to-Drink (RTD) Format
Table 58 Off-trade Sales of Concentrates (RTD) by Category: Volume 2006-2011
Table 59 Off-trade Sales of Concentrates by Category: Value 2006-2011
Table 60 Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth 2006-2011
Table 61 Off-trade Sales of Concentrates by Category: % Value Growth 2006-2011
Table 62 Company Shares of Concentrates (RTD) by Off-trade Volume 2007-2011
Table 63 Brand Shares of Concentrates (RTD) by Off-trade Volume 2008-2011
Table 64 Company Shares of Powder Concentrates (as sold) by Off-trade Volume 2007-2011
Table 65 Brand Shares of Powder Concentrates (as sold) by Off-trade Volume 2008-2011
Table 66 Company Shares of Concentrates by Off-trade Value 2007-2011
Table 67 Brand Shares of Concentrates by Off-trade Value 2008-2011
Table 68 Forecast Off-trade Sales of Concentrates (RTD) by Category: Volume 2011-2016
Table 69 Forecast Off-trade Sales of Concentrates by Category: Value 2011-2016
Table 70 Forecast Off-trade Sales of Concentrates (as sold) by Category: % Volume Growth 2011-2016
Table 71 Forecast Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth 2011-2016
Table 72 Forecast Off-trade Sales of Concentrates by Category: % Value Growth 2011-2016

Fruit/Vegetable Juice in Belarus - Category Analysis

HEADLINES

TRENDS
Local fruit/vegetable juice manufacturers continue to be supported by the state. The state has invested BYR307 billion in a programme entitled “Developing Juice and Canned Fruit and Vegetable Manufacturing in Belarus, 2006-2010” and also has plans to continue to invest over 2011-2015. This investment will go towards the further reconstruction of local juice factories and the purchase of new equipment for packaging juice and canned fruit and vegetables.

COMPETITIVE LANDSCAPE
Staraya Krepost IP led the category in 2011 with a 21% off-trade volume share. This company’s products came to the market in April 2008. From the beginning the strategic direction of this company was to become a leading player in fruit/vegetable juice in Belarus. The manufacturer’s annual production capacity is 70 million litres – sufficient to satisfy half of the existing demand for 100% juice and nectars in Belarus. Staraya Krepost was established in November 2006 with the participation of IFC and American investment group Detroit Investments Group. This alliance is known in Belarus as the founder of Pivovarni Heineken IZAO (former Pivovarennaya Kompaniya Syabar), which is currently one of the leading beer producers and belongs to Heineken. The same success was predicted for Staraya Krepost in fruit/vegetable juice. The investment project cost both investors US$20 million.

PROSPECTS
The key forecast prediction for fruit/vegetable juice in Belarus is a continued increase in locally produced juice and a decline in imports. The total production capacity of local juice producing factories that complied with EU standards as of 1 July 2009 was more than 200 million litres. This level of production can satisfy the country’s overall demand for juice. It is expected that by the end of the forecast period locally produced fruit/vegetable juice will account for an 80-90% share of total volume sales.

CATEGORY DATA

Table 73 Off-trade Sales of Fruit/Vegetable Juice by Category: Volume 2006-2011
Table 74 Off-trade Sales of Fruit/Vegetable Juice by Category: Value 2006-2011
Table 75 Off-trade Sales of Fruit/Vegetable Juice by Category: % Volume Growth 2006-2011
Table 76 Off-trade Sales of Fruit/Vegetable Juice by Category: % Value Growth 2006-2011
Table 77 Company Shares of Fruit/Vegetable Juice by Off-trade Volume 2007-2011
Table 78 Brand Shares of Fruit/Vegetable Juice by Off-trade Volume 2008-2011
Table 79 Company Shares of Fruit/Vegetable Juice by Off-trade Value 2007-2011
Table 80 Brand Shares of Fruit/Vegetable Juice by Off-trade Value 2008-2011
Table 81 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: Volume 2011-2016
Table 82 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: Value 2011-2016
Table 83 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: % Volume Growth 2011-2016
Table 84 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: % Value Growth 2011-2016

RTD Coffee in Belarus - Category Analysis

TRENDS
RTD coffee was not present in Belarus in 2011. In 2007, the local company Darida PChUP launched the first RTD coffee product in the market. However, sales remained low and, in total, only 70,000 250ml PET bottles were sold. In 2008, the company stopped production and no other manufacturer has since entered the category.

RTD Tea in Belarus - Category Analysis

HEADLINES

TRENDS
RTD tea is a relatively new product type in Belarus. Local manufacturers successfully started production in 2006. The affordable prices offered by local manufacturers appeal to a large audience, with active and more ‘modern’ consumers becoming aware of RTD tea as a healthy and refreshing drink. However, still low awareness of these products, as well as the tough economic climate, limited volume growth in 2011.

COMPETITIVE LANDSCAPE
Nestlé’s Nestea, the pioneer in RTD tea in Belarus, remained the leading brand in 2011. It benefited from the first-mover advantage by gaining the interest of young consumers who tend to be more open to innovation and new products. This well-known international brand created a safety net for Nestlé as the number of local producers increased. The company continued to launch new RTD tea products to retain consumer interest. In 2011, Nestea led RTD tea with a 35% share of off-trade volume sales and a 41% share of off-trade value sales. This represents a share increase of 3.5 percentage points in volume terms and 3.9 percentage points in value terms over 2010. However, the premium prices carried by Nestea limit its stronger growth or expansion.

PROSPECTS
RTD tea in Belarus is a young and developing category. Over the forecast period RTD tea is expected to register a total volume CAGR of 3% and a constant value CAGR of 5%. RTD tea is perceived as a healthier and more natural beverage than carbonates. Thus, RTD tea could become a substitute for carbonates over the medium to long term, with more local companies, which are already engaged in carbonates manufacturing, forecast to enter this prospective category.

CATEGORY DATA

Table 85 Off-trade Sales of RTD Tea by Category: Volume 2006-2011
Table 86 Off-trade Sales of RTD Tea by Category: Value 2006-2011
Table 87 Off-trade Sales of RTD Tea by Category: % Volume Growth 2006-2011
Table 88 Off-trade Sales of RTD Tea by Category: % Value Growth 2006-2011
Table 89 Company Shares of RTD Tea by Off-trade Volume 2007-2011
Table 90 Brand Shares of RTD Tea by Off-trade Volume 2008-2011
Table 91 Company Shares of RTD Tea by Off-trade Value 2007-2011
Table 92 Brand Shares of RTD Tea by Off-trade Value 2008-2011
Table 93 Forecast Off-trade Sales of RTD Tea by Category: Volume 2011-2016
Table 94 Forecast Off-trade Sales of RTD Tea by Category: Value 2011-2016
Table 95 Forecast Off-trade Sales of RTD Tea by Category: % Volume Growth 2011-2016
Table 96 Forecast Off-trade Sales of RTD Tea by Category: % Value Growth 2011-2016

Sports and Energy Drinks in Belarus - Category Analysis

HEADLINES

TRENDS
Sports and energy drinks is a small category in volume terms, with sales remaining low in 2011. However, energy drinks has potential for growth, particularly among young consumers. The components of energy drinks are regulated by the Belarusian Ministry of Health. According to legislation, from 1 March 2005, energy drinks must contain no more than two energy-boosting components, such as taurine, guarana or caffeine. In addition, components must be of a natural origin and their concentration must not exceed 400ml per one litre of product. Energy drinks must be labelled as ‘Not recommended for children, pregnant women, elderly people or those suffering from hypertonic and blood and heart diseases’.

COMPETITIVE LANDSCAPE
In 2011, the leading player in energy drinks in Belarus was The Coca-Cola Co with its brand Burn. The company held a 71% share of retail volume sales, up by 1.7 percentage points on 2010 thanks to offering the most well-known and popular brand, which was also regularly advertised. The Coca-Cola Co, which opened its manufacturing facilities in Belarus in 1994, also opened a representative office in the country a few years ago. The strong local presence of the company boosted sales of all Coca-Cola soft drinks in Belarus, not only locally produced ones.

PROSPECTS
Over 2011-2016 sports and energy drinks is expected to record a total volume CAGR of 3% and a constant value CAGR of 5%. This growth will be underpinned by the increasing consumer awareness of energy drinks. In addition, energy drinks are expected to become more affordable following the launch of cheaper domestic brand Dynamit in 2011. Further brands are likely to appear, including from local manufacturers.

CATEGORY DATA

Table 97 Off-trade Sales of Sports and Energy Drinks by Category: Volume 2007-2011
Table 98 Off-trade Sales of Sports and Energy Drinks by Category: Value 2006-2011
Table 99 Off-trade Sales of Sports and Energy Drinks by Category: % Volume Growth 2007-2011
Table 100 Off-trade Sales of Sports and Energy Drinks by Category: % Value Growth 2007-2011
Table 101 Company Shares of Sports and Energy Drinks by Off-trade Volume 2007-2011
Table 102 Brand Shares of Sports and Energy Drinks by Off-trade Volume 2007-2009
Table 103 Forecast Off-trade Sales of Sports and Energy Drinks by Category: Volume 2011-2016
Table 104 Forecast Off-trade Sales of Sports and Energy Drinks by Category: Value 2011-2016
Table 105 Forecast Off-trade Sales of Sports and Energy Drinks by Category: % Volume Growth 2011-2016
Table 106 Forecast Off-trade Sales of Sports and Energy Drinks by Category: % Value Growth 2011-2016