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Venezuela faces major political and economic uncertainty in the run-up to and immediate aftermath of the October 2012 presidential elections. Although real GDP growth came in at 5.6% y-o-y in H112, we still expect a sharp slowdown in growth in the second half of the year, as the country's current growth model, which is driven by pre-electoral fiscal and monetary stimulus, is unsustainable. Inflation will remain elevated, at the highest level in Latin America, and the operating environment will remain very precarious for foreign multinationals in the country.
Headline Industry Data (US$)
Cargill to Launch Stevia-Based Truvia in Venezuela: In July 2012 Cargill announced plans to launch Truvia, its stevia-based table-top sweetener, in Venezuela. The move follows success for the brand in the US, where it has already gained around 13% of the market. The move into Venezuela means that Truvia will be available in seven countries on three continents, according to a statement released by the firm, and this would signal that Cargill is planning a full global roll-out. The decision to launch in Venezuela comes despite the poor business environment within the food and drink sector as well as limited prospects for change in the near term. Despite this less-than-promising backdrop, Venezuela remains relatively attractive for certain added-value sectors for which price controls and government interference are not a significant issue.
Key Risks To Outlook
Election Uncertainty: The huge uncertainty surrounding policy trajectory beyond the election in October 2012 poses a significant downside risk to our growth forecast.
Inflationary Unrest: Inflation in Venezuela will remain elevated, at the highest level in Latin America. Indeed, we believe inflation will tick-up soon after the October presidential election, as reflected in our end-2012 inflation forecast of 26.0% y-o-y. With one of the highest rates of inflation in the world, we expect worker strikes within the private sector to continue to be a persistent feature of Venezuela’s landscape in the medium term.
Venezuela faces major political and economic uncertainty in the run-up to and immediate aftermath of the October 2012 presidential elections. Although real GDP growth came in at 5.6% y-o-y in H112, we still expect a sharp slowdown in growth in the second half of the year, as the country's current growth model, which is driven by pre-electoral fiscal and monetary stimulus, is unsustainable. Inflation will remain elevated, at the highest level in Latin America, and the operating environment will remain very precarious for foreign multinationals in the country.
Headline Industry Data (US$)
- Per capita food consumption forecast to 2016 = -33.2%.
- Alcoholic drink sales forecast to 2016 = -33.2%.
- Soft drink sales forecast to 2016 = -30.7%.
- Mass grocery retail sales forecast to 2016 = -31.1%.
Cargill to Launch Stevia-Based Truvia in Venezuela: In July 2012 Cargill announced plans to launch Truvia, its stevia-based table-top sweetener, in Venezuela. The move follows success for the brand in the US, where it has already gained around 13% of the market. The move into Venezuela means that Truvia will be available in seven countries on three continents, according to a statement released by the firm, and this would signal that Cargill is planning a full global roll-out. The decision to launch in Venezuela comes despite the poor business environment within the food and drink sector as well as limited prospects for change in the near term. Despite this less-than-promising backdrop, Venezuela remains relatively attractive for certain added-value sectors for which price controls and government interference are not a significant issue.
Key Risks To Outlook
Election Uncertainty: The huge uncertainty surrounding policy trajectory beyond the election in October 2012 poses a significant downside risk to our growth forecast.
Inflationary Unrest: Inflation in Venezuela will remain elevated, at the highest level in Latin America. Indeed, we believe inflation will tick-up soon after the October presidential election, as reflected in our end-2012 inflation forecast of 26.0% y-o-y. With one of the highest rates of inflation in the world, we expect worker strikes within the private sector to continue to be a persistent feature of Venezuela’s landscape in the medium term.
BMI Industry View
SWOT Analysis
Venezuela Food Industry SWOT
Venezuela Drink Industry SWOT
Venezuela Mass Grocery Retail Industry SWOT
Business Environment
BMI’s Core Global Industry Views
Table: Core Views
Latin America Risk/Reward Ratings
Table: Latin America Risk/Reward Sub-Factor Ratings Q412 (out of 10)
Table: Latin America Food & Drink Risk/Reward Ratings Q412
Venezuela’s Food & Drink Risk/Reward Rating
Macroeconomic Outlook
Strong Growth But Massive Risks Remain
Table: Venezuela – Economic Activity, 2011-2016
Industry Forecast Scenario
Consumer Outlook
Food
Total Food Consumption
Table: Venezuela Food Consumption Indicators – Historical Data & Forecasts, 2009-2016
Canned And Prepared Food
Table: Canned Food Value/Volume Sales – Historical Data & Forecasts
Table: Fish, 2009-2016
Edible Oil
Table: Oils and fats, 2009-2016
Confectionery
Table: Confectionery Value/Volume Sales – Historical Data & Forecasts, 2009-2016
Drink
Alcoholic Drinks
Table: Alcoholic Drink Value/Volume Sales – Historical Data & Forecasts, 2009-2016
Table: Wine Historical Data & Forecasts, 2009-2016
Soft Drinks
Table: Soft Drink Value Sales – Historical Data & Forecasts, 2009-2016
Hot Drinks
Table: Hot Drink Value Sales – Historical Data & Forecasts, 2009-2016
Mass Grocery Retail
Table: Venezuela Mass Grocery Retail – Value Sales by Format – Historical Data & Forecasts, 2009-2016
Table: Sales Breakdown by Retail Format Type
Trade
Table: Food & Drink Trade Balance – Historical Data & Forecasts, 2009-2016
Food
Key Industry Trends And Developments
Cargill to Launch Stevia-Based Truvia in Venezuela
Parmalat Continues to Find Venezuela Challenging
Currency Devaluation Increases Risk Of Food Appropriations
Venezuela Food & Drink Report Q4 2012
© Business Monitor International Ltd Page
Dairy Sector Attracts Investment, But BMI Cautious
Market Overview
Food Production
Confectionery
Agriculture
Dairy
Meat
Seafood
Drink
Key Industry Trends And Developments
Femsa Post Sales Growth
Soft Drink Firms Targeted By New Price Cap Laws
Empresas Polar Takes Stake In Mexican Firm
AmBev Seeks Additional Scale In Difficult Venezuela Market
Attack On Alcohol
Coffee Sector Nationalised
Market Overview
Alcoholic Drinks
Soft Drinks
Hot Drinks
Mass Grocery Retail
Key Industry Trends And Developments
Competition From Mercal
Nationalisation Of Exito
Market Overview
Leading Retailers
Table: Structure Of Mass Grocery Retail Market – Estimated Number Of Outlets
Table: Structure Of Venezuela’s Mass Grocery Retail Market – Sales Value By Format (US$bn)
Table: Average Annual Value Sales By Unit Per Format (2009)
Competitive Landscape
Table: Key Players In Venezuela's Food Sector
Table: Key Players In Venezuela's Drink Sector
Table: Key Players In Venezuela's Mass Grocery Retail Sector
Company Monitor
Food
Alimentos Heinz CA
Cargill de Venezuela
Empresas Polar
Drink
Pernod Ricard Venezuela
Coca-Cola FEMSA
Diageo de Venezuela
Mass Grocery Retail
Mercal CA
Makro Venezuela
Table: Venezuela's Population By Age Group, 1990-2020 ('000)
Table: Venezuela's Population By Age Group, 1990-2020 (% of total)
Table: Venezuela's Key Population Ratios, 1990-2020
Venezuela Food & Drink Report Q4 2012
© Business Monitor International Ltd Page
Table: Venezuela's Rural And Urban Population, 1990-2020
Risk/Reward Ratings Methodology
Table: Rewards
Table: Risks
Weighting
Table: Weighting
BMI Food & Drink Industry Glossary
Food & Drink
Mass Grocery Retail
BMI Food & Drink Forecasting & Sourcing
How We Generate Our Industry Forecasts
Sourcing
SWOT Analysis
Venezuela Food Industry SWOT
Venezuela Drink Industry SWOT
Venezuela Mass Grocery Retail Industry SWOT
Business Environment
BMI’s Core Global Industry Views
Table: Core Views
Latin America Risk/Reward Ratings
Table: Latin America Risk/Reward Sub-Factor Ratings Q412 (out of 10)
Table: Latin America Food & Drink Risk/Reward Ratings Q412
Venezuela’s Food & Drink Risk/Reward Rating
Macroeconomic Outlook
Strong Growth But Massive Risks Remain
Table: Venezuela – Economic Activity, 2011-2016
Industry Forecast Scenario
Consumer Outlook
Food
Total Food Consumption
Table: Venezuela Food Consumption Indicators – Historical Data & Forecasts, 2009-2016
Canned And Prepared Food
Table: Canned Food Value/Volume Sales – Historical Data & Forecasts
Table: Fish, 2009-2016
Edible Oil
Table: Oils and fats, 2009-2016
Confectionery
Table: Confectionery Value/Volume Sales – Historical Data & Forecasts, 2009-2016
Drink
Alcoholic Drinks
Table: Alcoholic Drink Value/Volume Sales – Historical Data & Forecasts, 2009-2016
Table: Wine Historical Data & Forecasts, 2009-2016
Soft Drinks
Table: Soft Drink Value Sales – Historical Data & Forecasts, 2009-2016
Hot Drinks
Table: Hot Drink Value Sales – Historical Data & Forecasts, 2009-2016
Mass Grocery Retail
Table: Venezuela Mass Grocery Retail – Value Sales by Format – Historical Data & Forecasts, 2009-2016
Table: Sales Breakdown by Retail Format Type
Trade
Table: Food & Drink Trade Balance – Historical Data & Forecasts, 2009-2016
Food
Key Industry Trends And Developments
Cargill to Launch Stevia-Based Truvia in Venezuela
Parmalat Continues to Find Venezuela Challenging
Currency Devaluation Increases Risk Of Food Appropriations
Venezuela Food & Drink Report Q4 2012
© Business Monitor International Ltd Page
Dairy Sector Attracts Investment, But BMI Cautious
Market Overview
Food Production
Confectionery
Agriculture
Dairy
Meat
Seafood
Drink
Key Industry Trends And Developments
Femsa Post Sales Growth
Soft Drink Firms Targeted By New Price Cap Laws
Empresas Polar Takes Stake In Mexican Firm
AmBev Seeks Additional Scale In Difficult Venezuela Market
Attack On Alcohol
Coffee Sector Nationalised
Market Overview
Alcoholic Drinks
Soft Drinks
Hot Drinks
Mass Grocery Retail
Key Industry Trends And Developments
Competition From Mercal
Nationalisation Of Exito
Market Overview
Leading Retailers
Table: Structure Of Mass Grocery Retail Market – Estimated Number Of Outlets
Table: Structure Of Venezuela’s Mass Grocery Retail Market – Sales Value By Format (US$bn)
Table: Average Annual Value Sales By Unit Per Format (2009)
Competitive Landscape
Table: Key Players In Venezuela's Food Sector
Table: Key Players In Venezuela's Drink Sector
Table: Key Players In Venezuela's Mass Grocery Retail Sector
Company Monitor
Food
Alimentos Heinz CA
Cargill de Venezuela
Empresas Polar
Drink
Pernod Ricard Venezuela
Coca-Cola FEMSA
Diageo de Venezuela
Mass Grocery Retail
Mercal CA
Makro Venezuela
Table: Venezuela's Population By Age Group, 1990-2020 ('000)
Table: Venezuela's Population By Age Group, 1990-2020 (% of total)
Table: Venezuela's Key Population Ratios, 1990-2020
Venezuela Food & Drink Report Q4 2012
© Business Monitor International Ltd Page
Table: Venezuela's Rural And Urban Population, 1990-2020
Risk/Reward Ratings Methodology
Table: Rewards
Table: Risks
Weighting
Table: Weighting
BMI Food & Drink Industry Glossary
Food & Drink
Mass Grocery Retail
BMI Food & Drink Forecasting & Sourcing
How We Generate Our Industry Forecasts
Sourcing