Beer Market: Non-alcohol and Low-alcohol Beer Central to Europe Market’s Growth

Not too long ago, major beer companies in Europe were limited to the local market. However, with rapid industrialization and development, beer is now being readily accepted across Western and Eastern Europe. Beer is the most favored alcoholic drink in Europe and with its increased consumption, the demand is going to scale new heights.

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Beer is the most consumed alcoholic beverage in Europe and several major players operating in the beer market hail from Europe. The most crucial factor impacting the demand for beer is its health benefits. It is known to keep the kidneys healthy, cure insomnia, and reduce cholesterol level, thus pushing the demand for beer. The soluble fiber present in lager beer helps in digestion and lowers the chances of intestinal transit. In addition, beer aids in enhancing bone density and strengthening the bones due to the presence of high silicon content in it. The market is said to prosper in Europe with improving disposable income of the consumers. Moreover, partnerships, mergers and acquisitions, and product inventions are projected to propel the Europe beer market in the forecast period.

However, the beer market in Europe is set to face tough competition from internal and external substitutes. Wine, vodka, rum, and whisky are the internal substitutes, whereas non-alcoholic drinks including dairy drinks, carbonated drinks, energy drinks, and ready-to-drink tea and coffee are some of the external substitutes, and its seasonality.

According to Transparency Market Research, the Europe beer market is expected to reach US$ 100.80 bn by 2021 from its initial value of US$ 87.6 in 2016.

Lager Beer to Continue to be Preferred Choice

On the basis of product, the European beer market has been segmented into lager beer, ale beer, and stout beer. Lager beer accounted for a larger market share, valuing US$17.01 bn in 2014. It is expected to reach US$20.05 bn by 2021, expanding at a CAGR of 2.4% from 2015 to 2021. Lager is the most preferred type of beer consumed in Europe. The term lager refers to the beer that is fermented with yeast at a much lower temperature than other styles such as ale and stout.

Ale yeast ferments more quickly, giving a fruity, sweet, and full-bodied taste to the beer compared to lager. Due to more variety, ale is the faster growing segment of the market. The European ale market was valued at US$ 35.17 bn in 2014 and is anticipated to reach US$ 43.48 bn by 2021, expanding at a CAGR of 3.1% from 2015 to 2021.

Eastern Europe takes the Lead in terms of Consumption

Eastern Europe offers a significant untapped potential opportunity for beer manufacturers to capitalize upon. Russia and Ukraine - the growing markets of Eastern Europe offer several expansion opportunities for beer manufacturers, hence expected to show a positive growth in the coming years. The major driving factors in this region include the long tradition of alcohol consumption in Eastern Europe, increasing disposable income of consumers, strong domestic brands, and modernization of distribution systems. In addition, the middle class consumers are looking at alternate options, thus propelling the beer industry in Eastern Europe over the forecast period.

The key players in the Europe beer market include Diageo, SAB Miller PLC, Carlsberg Group, Anheuser-Busch InBev, and Heineken N.V