Drinks industry proves quite resilient to downturn

Author: Melanie Perez

Date published: 30 Jan 2009

Euromonitor International's latest non-alcoholic drinks data reveals the impact of the economic downturn over 2008 and 2009 and the outlook for the coming years.

Many wonder how they're faring in today's economy where consumers and manufacturers alike are looking for ways to cut costs. According to Euromonitor International's latest 2009 Drinks data, despite the economic downturn the global drinks industry has proven to be quite resilient. The soft drinks market showed an increase of 3.8% in total volume terms for 2008 and the hot drink market experienced a 2.9% increase in total volume terms. However, with the economic plunge during the last few months of 2008, the outlook for some drinks categories may not be as bright.

The collapse of the housing market, which began with the US sub-prime mortgage sector in 2007 and then spread to many countries, was much swifter and deeper than expected. Further downturn of the economy threatens, in particular, high unit price beverages over the course of this year. “Functional and value-added drinks are some of the first to feel the squeeze during this downturn as their phenomenal growth over 2007 and 2008 witnesses a slowdown in 2008,” says Simon Maddrell, Head of Euromonitor International's Global Non-Alcoholic Drinks Research. “The Health and Wellness craze that prompted this growth may encourage consumers to accommodate these purchases or search for less expensive alternatives,” he adds.

According to Euromonitor, continued value growth, especially in the global soft drinks market going into 2009 will derive from Asia-Pacific, which is expected to increase by 5.1% over the 2008 and 2009 period. With the declining North American and Western European markets other emerging markets are proving to be areas of opportunity as well, including Argentina and Turkey. “Both markets demonstrated high growth rates in carbonates between 2007 and 2009, a category that as a whole has been suffering from a steady decline,” adds Mr Maddrell.

For further information, please contact:

Melanie Perez, Public Relations Executive, Euromonitor International

Tel: 312.922.1115 ext 8332 melanie.perez@euromonitorintl.com

Soft drinks