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Vietnam drinks more beer as times get tough

Publication Date : 15-12-2013

 

Beer makers in Vietnam produced 2.67 billion litres in the first eleven months of the year, up 7.8 per cent over the corresponding period last year, according to the Viet Nam Beer, Alcohol and Beverage Association (VBA).

The country's two biggest producers, Sai Gon Beer Corporation (Sabeco) and Ha Noi Beer Company (Habeco), turned out 1.19 billion litres and 490.0 million litres, up 5.7 per cent and 9.4 per cent respectively.

The association said December output would be 270,000-280,000 litres, bringing total production in 2013 to some 3 billion litres.

With this momentum, output could increase to 3.3 billion litres in 2014 and 3.6 billion in 2015, VBA's vice general secretary Le Ba Co told the media.

Beer consumption is expected to rise sharply during Tet, so beverage companies are increasing production capacity.

Market survey company Eurowatch announced in May that Vietnamese people consumed 3 billion litres of beer in 2012. Each Vietnamese person drank an average of 32 litres, making the country the third-largest per capita consumer in Asia, just behind China and Japan.

Vietnam's per capita income in 2012 was US$1,540.

Vietnam was also among the world's top 25 beer-consuming nations last year, according to Kirin Holdings Co., a major Japanese brewer.

Consumption rose highest in Nigeria (17.2 per cent), followed by India (17 per cent), Brazil (16 per cent) and Vietnam (15 per cent).

Luong Hoang Thai, head of the Ministry of Industry and Trade's Multilateral Commercial Department, said joining the TPP would give local beer producers the chance to attract more investment but would also pose a significant challenge.

Many TPP member countries such as the US, Japan, Canada, Mexico and Chile have advantages in exporting beverages. Without an import tax, local products might not be able to compete.

The Sai Gon Beer Corporation and Ha Noi Beer Company, which account for two-thirds of the local beer market, could be threatened by cheaper imports of popular foreign brands like Sapporo from Japan and ABInBev from the US.

The main reason people stick to local brews is because they are cheap and of decent quality, Thai said, warning that when living standards inevitably improved, many people would shift to foreign beers – especially if they were sold at cheaper prices.

Global beverage firms Pepsi and Coca-Cola already dominate the local non-alcoholic beverage market. Tan Hiep Phat is the only domestic producer that can stand up to their market power.

 

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