Central America Food and Drink Report Q1 2012
Includes 3 FREE quarterly updates
Growth in organised retailing is playing a major role in the development of Central America’s consumer sector, with the local unit of US retailer Walmart currently the driving force behind this expansion. Walmart is the undisputed market leader in Central America, and we see no sign of this changing over our forecast period, as a sustained investment programme will only strengthen its position. The retailer’s dominance could have negative implications for the region’s consumer sector over the longer term, and also on mass grocery retail market competition. In a market where less than 50% of food sales are made through organised channels, the continued development of the mass grocery retail sector will be a key factor driving the consumer segment.
Headline Industry Data (regional averages)
Key Company Trends
Costa Rican Farmers Setting Up Micro-Processing Plants To Sell Coffee Directly: A growing number of coffee farmers in Costa Rica are setting up their own micro-processing plants in a bid to serve international buyers directly, reports CentralAmericaData. The Instituto del Café de Costa Rica (Icafé)’s figures revealed that the number of processing plants has increased to 161 in 2011 from 94 in 2010. According to Marvin Barquero, the establishment of micro-processing plants allows small coffee farmers to sell directly to roasters on the international market by skipping exporters. Information from Icafé shows that the processing plants are enabling farmers to receive up to US$100 more per quintal (46 kilos) of processed coffee.
Walmart Opens New Discount Format : In December 2011 mass grocery retailer Walmart de México opened a new store in El Salvador under the banner Maxi Despensa. The discount-focused store is targeted at lower-income consumers, and the new format demonstrates the firm’s renewed focus on its ‘everday low pricing’, which is designed to attract a greater customer base to its network. The launch in El Salvador follows the opening of the firm’s first Maxi Despensa outlet in Honduras in November 2011.
Key Risks To Outlook
Political Risk: For some Central American markets, political risk is a significant factor for consideration. Central America remains one of the worst-affected areas in the world in terms of non-political violence, and we are concerned particularly about the potential for unrest in countries such as Honduras, Nicaragua and Guatemala. These states are among the poorest in the region and share the potentially explosive combination of high unemployment, youthful populations and stark inequality, as well as a high proportion of income spent on food and energy.
Growth in organised retailing is playing a major role in the development of Central America’s consumer sector, with the local unit of US retailer Walmart currently the driving force behind this expansion. Walmart is the undisputed market leader in Central America, and we see no sign of this changing over our forecast period, as a sustained investment programme will only strengthen its position. The retailer’s dominance could have negative implications for the region’s consumer sector over the longer term, and also on mass grocery retail market competition. In a market where less than 50% of food sales are made through organised channels, the continued development of the mass grocery retail sector will be a key factor driving the consumer segment.
Headline Industry Data (regional averages)
- 2012 per capita food consumption (US$) = +5.0%; forecast to 2016 = +28.3%
- 2012 alcoholic drink sales (litres) = +6.2%; forecast to 2016 = +35.5%
- 2012 soft drink sales (litres) = +5.3% ; forecast to 2016 = +30.8%
- 2012 mass grocery retail sales (US$) = +6.0%; forecast to 2015 = +35.0%
Key Company Trends
Costa Rican Farmers Setting Up Micro-Processing Plants To Sell Coffee Directly: A growing number of coffee farmers in Costa Rica are setting up their own micro-processing plants in a bid to serve international buyers directly, reports CentralAmericaData. The Instituto del Café de Costa Rica (Icafé)’s figures revealed that the number of processing plants has increased to 161 in 2011 from 94 in 2010. According to Marvin Barquero, the establishment of micro-processing plants allows small coffee farmers to sell directly to roasters on the international market by skipping exporters. Information from Icafé shows that the processing plants are enabling farmers to receive up to US$100 more per quintal (46 kilos) of processed coffee.
Walmart Opens New Discount Format : In December 2011 mass grocery retailer Walmart de México opened a new store in El Salvador under the banner Maxi Despensa. The discount-focused store is targeted at lower-income consumers, and the new format demonstrates the firm’s renewed focus on its ‘everday low pricing’, which is designed to attract a greater customer base to its network. The launch in El Salvador follows the opening of the firm’s first Maxi Despensa outlet in Honduras in November 2011.
Key Risks To Outlook
Political Risk: For some Central American markets, political risk is a significant factor for consideration. Central America remains one of the worst-affected areas in the world in terms of non-political violence, and we are concerned particularly about the potential for unrest in countries such as Honduras, Nicaragua and Guatemala. These states are among the poorest in the region and share the potentially explosive combination of high unemployment, youthful populations and stark inequality, as well as a high proportion of income spent on food and energy.
Contents
BMI Industry ViewSWOT Analysis
Central America Food Industry SWOT
Central America Drink Industry SWOT
Central America Mass Grocery Retail Industry SWOT
Business Environment
BMI’s Core Global Industry Views
Table: Agricultural Commodity Prices
Table: Core Views Q112
Latin America Sector Focus
Brewing Consolidating Around Heineken, SABMiller And ABI
Latin America Risk/Reward Ratings
Table: Brazil Food & Drink Risk/Reward Ratings – Q112
Table: Latin America Food & Drink Risk/Reward Ratings – Q112
Macroeconomic Outlook
Guatemala Economic Outlook
Table: Guatemala – Economic Activity
El Salvador Economic Outlook
Table: El Salvador – Economic Activity
Honduras Economic Outlook
Table: Honduras – Economic Activity
Costa Rica Economic Outlook
Table: Costa Rica – Economic Activity
Industry Forecast Scenario
Consumer Outlook
Food
Food Consumption
Table: Guatemala – Food Consumption
Table: Costa Rica – Food Consumption
Table: El Salvador – Food Consumption
Table: Honduras – Food Consumption
Prepared Food
Table: El Salvador – Confectionery
Table: El Salvador – Meat
Table: El Salvador – Jams And Jellies
Table: El Salvador – Pasta
Prepared Fish
Table: El Salvador – Fish
Table: Coasta Rica – Fish
Oils And Fats
Title: Guatemala – Soya Bean Oil
Table: El Salvador – Margarine
Table: Costa Rica – Soya Bean Oil
Dairy
Table: El Salvador – Dairy
Drink
Hot Drinks
Table: Guatemala – Coffee Sales
Table: Costa Rica – Coffee Sales
Table: El Salvador – Coffee Sales
Table: Honduras – Coffee Sales
Alcoholic Drinks
Table: Guatemala – Alcohol Sales
Table: Costa Rica – Alcohol Sales
Table: El Salvador – Alcohol Sales
Table: Honduras – Alcohol Sales
Soft Drinks And Bottled Water
Table: Guatemala – Soft Drink Sales
Table: Costa Rica – Soft Drink Sales
Table: El Salvador – Soft Drink Sales
Table: Honduras – Soft Drink Sales
Mass Grocery Retail
Table: Regional Sales Breakdown By Retail Format (%)
Table: Guatemala – Mass Grocery Retail Sales
Table: Costa Rica – Mass Grocery Retail Sales
Table: El Salvador – Mass Grocery Retail Sales
Table: Honduras – Mass Grocery Retail Sales
Trade
Table: Guatemala – Trade Balance
Table: Costa Rica – Trade Balance
Table: El Salvador – Trade Balance
Table: Honduras – Trade Balance
Food
Key Industry Trends And Developments
Costa Rican Growers Must Adhere To New US Food Safety Law
FEMSA Moves Into Dairy Segment
Nestlé Makes Guatemalan Acquisition
Walmart Giving Producers a Hand
Market Overview
Drink
Key Industry Trends And Developments
Costa Rican Farmers Setting Up Coffee Micro-Processing Plants
SABMiller Raises Volume Forecasts At Expense Of Price Growth
Regional Consolidation In Soft Drinks
Increased Competition In Brewing Sector
Market Overview
Hot Drinks
Soft Drinks
Alcoholic Drinks
Mass Grocery Retail
Key Industry Trends And Developments
Walmart Launches New Discount Format In El Salvador
Walmart Investing In Expansion
Colombian Retailer Olimpica Moves Into Central America
Market Overview
Competitive Landscape
Table: Key Players In Central America’s Food & Drink Sector
Table: Key Players In Guatemala’s Mass Grocery Retail Sector (2010)
Table: Key Players In El Salvador’s Mass Grocery Retail Sector (2010)
Table: Key Players In Costa Rica’s Mass Grocery Retail Sector (2010)
Table: Key Players In Honduras’s Mass Grocery Retail Sector (2010)
Company Monitor
Food
Diana Food
Drink
Central America Beverage Corporation (CABCORP)
SABMiller
Mass Grocery Retail
Walmart Centroamerica
BMI Methodology
Food & Drink Business Environment Ratings
Ratings Methodology
Ratings System
Indicators
Table: Limits Of Potential Returns
Table: Risks To Realisation Of Potential Returns
Weighting
Table: Weighting
BMI Food & Drink Industry Glossary
Food & Drink
Mass Grocery Retail
BMI Food & Drink Forecasting And Sources
How We Generate Our Industry Forecasts
Sources Skip to top