Bulgaria Food and Drink Report Q1 2013
Report description
Our outlook for the Bulgarian consumer sector remains gloomy, due to a number of lingering challenges over the medium and long term. Economic growth has flatlined due to weakening demand from the eurozone (approximately 60% of total Bulgarian exports are destined for Europe) and a larger concomitant slowdown in domestic demand as export intensive industrial activity slows. Further dragging on growth is fiscal austerity and the domestic banking sector’s exposure to peripheral eurozone banks, which will restrict credit growth while also continuing to pose major downside risks to the country’s economic growth. Over the longer term, issues such as economic difficulties and the emigration of younger and better-qualified workers will compound this situation, limiting the opportunities for premiumisation. We forecast private consumption growth of 0.7% and 1.0% in 2012 and 2013 respectively, and expect a slight rebound in real GDP growth in 2013, to 1.4%, from 0.1% in 2012.
Headline Industry Data (local currency)
? 2013 per capita food consumption growth: +1.84%; forecast compound annual growth rate to 2017: +2.53%.
? 2013 alcoholic drinks value sales growth: +3.41%; forecast compound annual growth rate to 2017: +5.06%.
? 2013 soft drinks value sales growth: +5.56%; forecast compound annual growth rate to 2017: +4.06%.
? 2013 mass grocery retail sales growth: +3.55%; forecast compound annual growth rate to 2017: +5.43%.
Key Industry Trends
Wine Exports Continue to Grow: In November, Bulgaria's Executive Agency on Vine and Wine reported that wine exports grew by 7.4% in the first nine months of 2012, with 36mn litres of wine exported, up from 2.5mn during the same period in 2011. On the back of this success, the agency announced that Bulgaria is planning to launch a campaign to promote its wines in non-EU countries. The campaign will start in January 2013, lasting three years, with a cost of EUR2.7mn.
Authorities Bust Bad Meat: In October 2012, a meat processing plant located in Silistra in the north of the country was closed down after Bulgaria’s Food Safety Agency found 4,200kg of frozen meat with expiration dates from 2009 and no documentation. This is one of the biggest meat processing plants in the country, with the meat destined for export to Russia. The Bulgarian Food Safety Agency was launched in early 2011 due to rising concerns about food safety in the country.
Key Risks To Outlook
Eurozone Crisis Main Risk: The eurozone crisis continues to represent the major risk to our forecasts. In the event of a serious deterioration in the sovereign debt crisis, with a sovereign default or member exit the worst-case scenario, we would expect this to significantly drag on headline growth. The Bulgarian banking system is particularly vulnerable to a Greek exit from the eurozone given the presence of several Greek banks in Bulgaria.
Table of contents
Chapter - BMI Industry View
Chapter - SWOT Analysis
Bulgaria Food Industry SWOT
Bulgaria Drink Industry SWOT
Bulgaria Mass Grocery Retail Industry SWOT
Chapter - Business Environment Ratings
BMI's Core Global Industry Views
Table: Core Views
CEE Food & Drink Risk/Reward Ratings
Table: Central & Eastern Europe Q113 Food & Drink Risk/Reward Ratings
Table: Central & Eastern Europe Q113 Food & Drink Risk/Reward Sub-Factor Ratings (scores out of 10)
Bulgaria's Food & Risk/Reward Rating
Macroeconomic Outlook
Table: Economic Activity
Chapter - Industry Forecast Scenario
Consumer Outlook
Food
Food Consumption
Table: Food Consumption Indicators – Historical Data & Forecasts, 2010-2017
Confectionery
Table: Confectionery Volume/Value Sales – Historical Data & Forecasts, 2010-2017
Canned Food
Table: Canned Food Value/Volume Sales – Historical Data & Forecasts, 2010-2017
Meat
Table: Meat Consumption, Production And Trade – Historical Data & Forecasts, 2010-2017
Pasta
Table: Pasta Consumption, Production And Trade – Historical Data & Forecasts, 2010-2017
Snacks And Other Processed Food
Table: Jams & Jellies Consumption, Production And Trade – Historical Data & Forecasts, 2010-2017
Table: Baked Products Consumption, Production And Trade – Historical Data & Forecasts, 2010-2017
Dairy
Table: Dairy Consumption, Production And Trade – Historical Data & Forecasts, 2010-2017
Drink
Alcoholic Drinks
Table: Alcoholic Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017
Soft Drinks
Table: Soft Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017
Hot Drinks
Table: Hot Drinks Value/Volume Sales – Historical Data & Forecasts, 2010-2017
Mass Grocery Retail
Table: Mass Grocery Retail Sales – Historical Data & Forecasts, 2010-2017
Table: Grocery Retail Sales By Format
Trade
Table: Trade Indicators – Historical Data & Forecast, 2010-2017
Chapter - Food
Key Industry Trends And Developments
Authorities Promote Organic Farming
Organic Foods As Niche Growth Area
Qatar And Bulgaria Eyeing Agricultural Partnerships
Bulgaria Continues To Increase Agricultural Output
Food Hygiene And Safety Ongoing Concerns
Market Overview
Food Consumption
Food Production
Leading Players
Confectionery
Canned Food
Trade
Agriculture
Organic Farming
Chapter - Drink
Key Industry Trends And Developments
Bulgarian Wine Remains Of Interest
Smoking Ban Expected To Affect Alcoholic Drinks Sales
Brewer Offload Malt Production Plant To Focus On Core Beer Production
Companies Breach Regulations
Market Overview
Alcoholic Drinks
Beer
Wine
Spirits
Soft Drinks
Hot Drinks
Chapter - Mass Grocery Retail
Key Industry Trends And Developments
Delhaize Closing Underperforming Bulgarian Stores
Consolidation In MGR In Line With Wider Regional Trends
Discount Players Invest In Expansion In Bulgaria
Companies Experiment With New Store Formats
Large Retailers Accused Of Pressuring Local Producers
Market Overview
Leading Retailers
Table: Structure Of The Mass Retail Grocery Market By Number Of Outlets, 2002-2011
Table: Structure Of The Mass Retail Grocery Market By Value, 2002-2011
Table: Value Sales By Individual Outlet Type (2011)
Chapter - Competitive Landscape
Table: Key Players In Bulgaria's Food Sector
Table: Key Players In Bulgaria's Drink Sector
Table: Key Players In Bulgaria's Mass Grocery Retail Sector
Chapter - Company Monitor
Food
Unilever Bulgaria
Kraft Bulgaria
Nestlé Bulgaria AD
Ital Food Industry AD
Drink
Zagorka (Heineken)
Carlsberg Bulgaria
Kamenitza (StarBev, formerly InBev Bulgaria)
Devin
Mass Grocery Retail
Metro Cash & Carry Bulgaria
Rewe Bulgaria (Billa and Penny Markt)
CBA Bulgaria
Piccadilly (Delta Delhaize)
Lidl Bulgaria
Chapter - Demographic Outlook
Table: Bulgaria's Population By Age Group, 1990-2020 ('000)
Table: Bulgaria's Population By Age Group, 1990-2020 (% of total)
Table: Bulgaria's Key Population Ratios, 1990-2020
Table: Bulgaria's Rural And Urban Population, 1990-2020
Chapter - BMI Methodology
Table: Rewards
Table: Risks
Weighting
Table: Weighting
Chapter - BMI Food & Drink Industry Glossary
Food & Drink
Mass Grocery Retail
Chapter - BMI Food & Drink Forecasting & Sourcing
How We Generate Our Industry Forecasts
Sourcing
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