Supply Chain Research

Philippine-domiciled beer brewer San Miguel will open a new plant in the U.S., the Philippine Star reports, with a 2 million hectoliter capacity and costing $150 million. That’s part of a global expansion plan including $500 million of investments to diversify sales for the beer-to-oil conglomerate.

The brewery appears to have struggled to make inroads to the U.S.market over the past five years. Panjiva data shows U.S. seaborne imports by the company are 62.3% lower year-to-date than the same period in 2015, though there has been a 16.7% recovery vs. the same period in 2016 suggesting marketing efforts are improving.

Chart segments U.S. seaborne imports by San Miguel by year. Source: Panjiva

The issue may be market acceptance of Asian beers, particularly lagers, more broadly. Imports from the top six Asian exporters (China, South Korea, Japan, Thailand, India and the Philippines – San Miguel’s home market) have increased by just 0.6% annually in the past three years. That’s lagged total U.S. imports that have climbed 5.1% (mostly due to Mexican shipments) and resulting in Asia’s brewers only holding a 0.5% share of imports.

Chart segments U.S. imports of beer by region of origin (blue line) and total (orange line, right hand axis) on a monthly (dotted) and annual average (solid) basis. Source: Panjiva

San Miguel may have more luck selling into China, whose imports of beer have increased by 23.6% annually in the past three years, reaching $699 million in the past 12 months. Shipments from other Asian countries have seen the fastest growth, climbing 33.2% in the past three years and by 89.6% in the third quarter. The leading importer in the past year has been Anheuser Busch, followed by distributor Jebsen and brewer Hite Jinro.

Chart segments Chinese imports of beer by consignee on a quarterly basis. Lower panel shows change in top 20 consignees aggregated. Source: Panjiva