Slovakia Food and Drink Report Q3 2009

Publication Date	June 2009
Publisher	Business Monitor
Product Type	Report
Pages	74
ISBN Number	not applicable
Product Code	BMI00235

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Summary

In BMI's Business Environment Rating (BER) matrix for Q309, Slovakia is placed in joint fifth position, alongside Slovenia, out of the 14 major regional markets surveyed in Central and Eastern Europe (CEE).

In fact, Slovakia has considerably improved its position in the CEE matrix since Q408, although one of the reasons for this is that some other countries in the region are expected to fare worse in the current economic downturn. However, Slovakia is also expected to post negative GDP growth for the year, with BMI recently revising our projection of -0.9% to -2.5% in line with the ongoing economic slowdown in the eurozone. Beyond 2009, we expect trend growth to settle at a much lower rate than in previous years, averaging 3.4% between 2011 and 2013.

In the meantime, key draws to doing business in Slovakia will remain based on its pro-business stance and relatively high per capita food and drinks consumption. However, its modest population size and falling consumer purchasing power will hamper the development of the food and drinks value throughout the current year at least, although official figures for February 2009 suggest that food, drinks and tobacco sales are holding up well, rising by 12.9% year-on-year (y-o-y), despite a double-digit fall in terms of overall retail sales. Through 2013, we expect an 18% US dollar increase in food consumption at consumer prices, to some US$6.9bn. The January 2009 adoption of the euro is not expected to make a major difference to prices, as it seems to have resulted in price developments that were in line with the government expectations. Consequently, the authorities do not envisage needing to introduce measures to prevent unjustified increases in prices. What is more, some consumer products, including food and electronics, are actually priced at lower levels, due to rounding down, rather than up, of their previous prices.

In terms of individual food and beverages segments, the figures released in April 2009 by the Slovakian Beer and Malt Producers? Association (SZVPAS) show that beer sales are struggling, falling by between 10 and 15% in the first two months of 2009. The decline has been attributed to a number of factors, including colder weather, the strength of the euro that is encouraging imports, fluctuating prices of raw materials, as well as falling consumer confidence. In fact, consumers are already turning to cheaper products in the face of a price increase implemented by some brewers to compensate for rising raw material prices. The Association reported that the share of non-premium brands as a percentage of total consumption increased from 30% during 2008 to as much as 70%, which will be negatively reflected in market values. Breweries such as Heineken Slovensko are attempting to address this trend through the promotion of larger volume and thus value-for-money packaging, although we expect the sales of beer to continue struggling in the face of the current economic adversity.

Content

Executive Summary
SWOT Analysis
Slovakia Food Industry SWOT
Slovakia Drink Industry SWOT
Slovakia Mass Grocery Retail Industry SWOT
Business Environment
CEE Food & Drink Business Environment Ratings
- Table: Regional Food & Drink Business Environment Ratings Q3 2009
Slovakia's Food and Drink Business Environment Ratings
Macroeconomic Outlook
- Table: Slovakia Economic Activity - Historical Data & Forecasts
Food
Industry Forecast Scenario
Food Consumption
- Table: Slovakia Food Consumption Indicators - Historical Data & Forecasts
Canned Food
- Table: Slovakia Canned Food Value/Volume Sales - Historical Data & Forecasts
Confectionery
- Table: Slovakia Confectionery Value/Volume Sales - Historical Data & Forecasts (US$mn unless otherwise stated)
Trade
- Table: Slovakia Food, Drink & Tobacco Trade Indicators (US$mn) - Historical Data and Forecasts
Industry Developments
Market Overview
Food Consumption
Food Production
Main Players
Confectionery
Canned Food
Trade
Agriculture
Dairy Industry
Drink
Industry Forecast Scenario
Alcoholic Drinks
- Table: Slovakia Alcoholic Drinks Indicators - Historical Data & Forecasts
Soft Drinks
- Table: Slovakia Soft Drinks Indicators - Historical Data & Forecasts
Hot Drinks
- Table: Slovakia Hot Drinks Indicators (US$mn) - Historical Data & Forecasts
Industry Developments
Market Overview
Beer
Wine
Spirits
Soft Drinks
- Table: Slovakia - Volume Consumption of Soft Drinks by Category (mn litres)
- Table: Slovakia - Value Consumption of Soft Drinks by Category (US$mn)
Hot Drinks
Mass Grocery Retail
Industry Forecast Scenario
- Table: Slovakia Mass Grocery Retail Sales By Format (US$bn) - Historical Data & Forecasts
- Table: Slovakia Grocery Retail Sales By Format (%) - Historical Data & Forecasts
Industry Developments
Market Overview
Main Players
- Table: Structure of Slovakia's Mass Grocery Retail Market by Estimated Number of Outlets
- Table: Structure of Slovakia's Mass Grocery Retail Market - Sales Value by Format (US$mn)
- Table: Average Value Per Outlet (US$mn)
Competitive Landscape
Key Players Food & Drink
- Table: Key Players in Slovakian Food & Drink Sector - 2008 estimates
Mass Grocery Retail
- Table: Key Players in Slovakian Mass Grocery Retail Sector - 2008
Company Analysis
Food
Tauris AS
Nestl?(C) Slovensko
Kraft Foods Slovakia
Drink
SABMiller Slovakia
Heineken Slovensko AS
Staropramen Slovakia
Mass Grocery Retail
Coop Jednota Slovensko sd
Tesco Stores SR
Schwarz Group
Appendix
Commodity Price Forecasts
Corn
- Table: Corn, 2005-2010
Soybean
- Table: Soybean, 2005-2010
Rice
- Table: Rice, 2005-2010
Wheat
- Table: Wheat, 2005-2010
Cocoa
- Table: Cocoa, 2005-2010
Coffee
- Table: Coffee, 2005-2010
Milk
- Table: Milk, 2005-2010
Sugar
- Table: Sugar, 2005-2010
Country Snapshot: Slovakia Demographic Data
Section 1: Population
- Table: Demographic Indicators, 2005-2030
- Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education and Healthcare
- Table: Education, 2002-2005
- Table: Vital Statistics, 2005-2030
Section 3: Labour Market and Spending Power
- Table: Employment Indicators, 2001-2006
- Table: Consumer Expenditure, 2000-2012 (US$)
- Table: Average Annual Wages, 2000-2012
Food & Drink Business Environment Ratings
Ratings Methodology
Ratings Overview
Ratings System
Indicators
Limits of Potential Returns
Risks to Realisation of Potential Returns
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