Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Coffee; Other hot drinks; Tea
Executive summary
Coffee margins are diluted in supermarkets/hypermarkets
As with many products of mass consumption in Peru, bodegas and
supermarket/hypermarkets represent the major distribution channels, accounting
for more than 80% of sales at national level of hot drinks. Margins for
manufacturers selling through these outlets are higher than those at
supermarkets: those of bodegas are calculated at around 25%, while nominal
margins in supermarkets are between 32% and 35%. However, companies must pay
fees for their brands to be positioned on the prime shelf spaces in
supermarkets, thus margins for producers are lower than in other selling
points.
Fruit/herbal tea increasing presence
Consumption of fruit/herbal tea (such as camomile, anisette, boldo, cat' s
claw) is increasing. Since 2004 volume sales have grown on a yearly basis so
that at the end of the review period the category has seen growth of 5%. This
increase is based on the preference of consumers for fruit/herbal drinks
instead of black standard tea or coffee due to the fact that they consider
them healthier. Demand is concentrated in the city of Lima because generally
urban consumers are more health-conscious and aware of new product
developments.
Success in domestic market is the next step
Altomayo Peru SA, the major Peruvian coffee export company with more than 40
years in the country, created and developed the Altomayo brand through which
it accessed the domestic hot drinks market in 2004. Already, in 2006, this
brand is ranked second in the country. Peruvian export companies (Peru is the
eighth largest coffee producer in the world) are keen to develop the domestic
market further in an effort to diminish the effects of international price
fluctuations. This prospect seems more realistic following the stabilisation
of prices in Peru in the middle of the review period.
Peruvian coffee, a successful product during 2006
In 2006, Peruvian green coffee was the best selling export of all the
different types of coffee products, achieving US$500 million in export value
sales. Coffee exports represent 90% of the market. For 2006, production is
calculated to be 450,000 tonnes. Peruvian coffee has been gaining
international prestige and is now valued at a price just 2% lower than the
prices of the leading Brazilian and Colombian coffees. In 2006, prices went up
15% in comparison to the previous year. Coffee production had shown an average
annual growth rate of 6% over the review period and Peru is the major producer
of organic coffee in the world.
Other plant-based hot drinks control nearly 50% of national production in tea
According to Euromonitor International' s research, under Peruvian State
Statistics registrations, other plant-based hot drinks and tea are included in
the same category when referring to national production or volume/value sales.
This is because both categories shared the same presentations -- tea bags --
the only industrialised form in which these products are sold. However,
according to Euromonitor International' s trade press research, 49% is
accounted for by other-plant based hot drinks and 51% by tea in the total
production figures as described in State Statistics.
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