© Copyright 2017 Beroe Inc. All rights reserved. Developing markets boost beverage can sourcing
© Copyright 2017 Beroe Inc. All rights reserved.
Developing markets boost beverage can sourcing
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Table of Contents (1/2)
01Executive Summary
• Executive Summary
02Market Analysis
• Value Chain Analysis• Global Market Outlook– Current market size – Demand-Supply trends and forecast– Key end use industries– Trade dynamics
• Regional Market Outlook [USA, Europe & Asia]– Current market size – Demand-Supply trends and forecast– Trade dynamics
03Industry Analysis
• Industry Outlook [NA, Europe, SA & Asia]– Drivers and Constraints for the industry– Mergers & acquisitions– Innovations– Porters Five Forces Analysis
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Table of Contents (2/2)
04Cost Analysis
• Cost Model for Aluminum beverage cans
05Supplier Analysis
• Mergers and Acquisitions• Capacity Expansions• Supplier market share – global• Regional Capacity Share• Key global and regional suppliers• Key supplier’s capability analysis– Capacity– Product Portfolio
• Detailed supplier profiling of the top global suppliers– SWOT Analysis for the top 5 global
suppliers– Financial Risk for top global suppliers (if
publicly listed)
06Industry Best Practices
• Industry Best sourcing practices for Aluminum Beverage Cans
Previous Slide
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Executive Summary (1/4)
Sources: Primary Expert 1, Primary Expert 2, Beroe Analysis
MARKET OVERVIEWGlobal market size –
329 Billion Units (2015)Expected to grow at a CAGR of 3-4% to 391
Billion Units by 2020
Key Growth RegionAsia (114 billion units, 35 percent) is expected grow at 4-5 percent CAGR, to 139 billion units in 2020
Supply Base for Beverage cans
Concentration High Medium Low
Key TrendsSustainability: Increased use of recycled content has improved the sustainability of cans
Printing & Decoration: Advanced shaping and functional printing techniques such as photochromic and tactile effects are increasingly adopted
Key Developments• Ball has merged with Rexam to form the worlds largest supplier with 31
percent market share• Ardagh has expanded into the beverage can segment through the
acquisition of the divested assets from Ball-Rexam merger to become the third largest supplier with 9 percent market share
Emerging Markets Middle East, India, China, LATAMSupply base is fairly fragmented with participation of regional suppliers
Developed Regions – NA, EuropeThe top four global players have more than 80% of the market shareBrand owners are integrated into can manufacturing
COST BREAKUP – BEVERAGE CANS
Raw Material Cost
38-40%
Conversion Cost
35-40%
Fixed & Overhead Cost
8-10%
Printing Cost
5-10%
Labor Cost
1-2%
TOP GLOBAL SUPPLIERS MARKET SHARE 2015
Ball Corporation
31%
Crown Holdings
18%
Ardagh Group
9%
Can-Pack
4%
Globally, the supply base is consolidated with the top three suppliers holding about 60 percent of the market share.
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Executive Summary (2/4)
Supplier Maturity LowMediumHigh
01
• Global beverage can market is expected to grow at 3-4 percent CAGR during 2015-2020, to reach 391 billion units driven by the increasing consumption of CSD and beer in the developing markets like China, Middle East, India, etc.; the slow down in the consumption of CSD in NA and EU would be compensated by the increased consumption in the emerging markets
• Specialty cans (slim) are expected to experience the highest growth of about 8-10 percent CAGR over the next five years owing to increasing penetration in energy drinks, premium water, juices, RTD beverages, etc.,
KeyTakeaway
05
06
01 North America
113 billion units growing at 2-3 percent
04 Asia
98 billion units growing at 4-5 percent
05 Middle East & Africa
19 billion units growing at 4-5 percent
02 Europe
68 billion units growing at 2-3 percent
03 LATAM
29 billion units growing at 3-4 percent
06 Australia
2 billion units growing at 2.5 percent
Sources: Primary Expert 1, Primary Expert 2, Beroe Analysis
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Executive Summary (3/4)Regional Demand Overview
Sources: Primary Expert 1, Primary Expert 2, Beroe Analysis
Regions Regional Supply
Capacity Additions Buyer power Demand Trends
(2015-2020)Top Regional
Suppliers Key Supply Base Trend
NABeer: CAGR: 2-3 percentCSD: CAGR: -1-0 percentEnergy Drinks: CAGR 4-5 percent
• Ball• Crown• Ardagh
Suppliers are focusing on boosting the recycling rates to facilitate sustainability.
EUBeer: CAGR: 1-2 percentCSD: CAGR: -1-2 percentEnergy Drinks: CAGR 3-4 percent
• Ball• Crown• Ardagh
Supply base is consolidated with suppliers looking to improve recycling rates.
AsiaBeer: CAGR: 5-6 percentCSD: CAGR: 1-2 percentEnergy Drinks: CAGR 9-10 percent
• Ball• Crown• Pacific Can
Suppliers are investing to enhance production capacity to supply local demand.
SABeer: CAGR: 2-3 percentCSD: CAGR: 2-3 percentEnergy Drinks: CAGR: 6-7 percent
• Ball• Crown• Ardagh
Reduced consumption would lead to suppliers reducing their production costs.
• The maturing consumption of beer and CSD in developed markets and increasing consumption in the emerging markets have led to the expansion of manufacturing facilities in countries such as Myanmar, Thailand, UAE, Cambodia, India, etc.,
High
High
High
Low
High
Medium
High High Medium–High
Medium–High
Medium
Medium
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Executive Summary (4/4)Countries of Focus
The highlighted countries are the most prominent production locations for beverage cans in each region. Developed markets have matured supply base and technological advancements and emerging markets have high growth potential driven by increasing consumption.
Developed
Emerging
Sources: Primary Expert 1, Primary Expert 2, Beroe Analysis
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