Bottled Water in Brazil

2020 IMPACT

Bottled water consumption plummets due to COVID-19 fallout

Off-trade bottled water consumption in Brazil surged during the early months of 2020 following a severe deterioration in the quality of tap water in Rio de Janeiro. This widely reported crisis damaged public confidence in the safety of tap water generally, leading people across the country to switch to bottled water.

Home seclusion and increased budget-consciousness boost bulk volume sales

While overall bottled water consumption has declined dramatically in 2020 due to the fallout of COVID-19, the category looks set to register robust growth in bulk volume sales for the year as a whole. As lockdown measures, remote working and social distancing have resulted in Brazilians spending more time at home, many have switched from smaller pack sizes – such as 1.

Off-trade distribution shifts benefit smaller and regional brands

Bottled water in Brazil is highly fragmented. This is particularly true of still natural mineral bottled water, the dominant category, where there are over 500 companies present.

RECOVERY AND OPPORTUNITIES

Bottled water consumption set to rebound from 2021

Bottled water should see a return to growth in off- and on-trade volume sales from 2021 as the Brazilian economy begins to recover in line with a projected improvement in epidemiological conditions. Weakened purchasing power and enduring concerns about community transmission of COVID-19 will continue to discourage many people from frequenting foodservice outlets in the short term, hence off-trade volume sales are initially expected to rebound faster than on-trade sales.

Rising health awareness will continue to drive demand

Rising health-consciousness in Brazil will continue to fuel demand for bottled water at both the off- and on-trade levels over the forecast period. This trend, which has been strengthened by the experience of the COVID-19 pandemic, is making Brazilians more aware of how staying adequately hydrated throughout the day can not only improve general health and wellbeing, but also have specific benefits in areas like skin care, digestion, memory and concentration etc.

Distribution and packaging expected to remain key points of competition

Economic recovery should create more opportunities for differentiation in bottled water over the forecast period. For example, as purchasing power improves it is likely some players will attempt to win over consumers by introducing premium-oriented products claiming to offer higher quality standards, new flavoured varieties, imported brands etc.