China Has A Serious Thirst For Imported Premium Bottled Waters

China’s newly-affluent, health-conscious urban consumers are driving sales of premium mineral waters. Packaged water sales in China grew 14 percent in the first half of 2017, a much higher rate than the two percent posted by the whole range of FMCG offerings. The top five local bottled water brands continue to dominate the mass market, claiming a 70 percent market share. But imported brands, including Nestlé’s Perrier and San Pellegrino, control the upscale segment. In fact, Nestlé “higher than expected” double-digit growth in sales of its premium sparkling mineral waters in China pushed the country ahead of Japan as Perrier’s largest market. Chinese brands are competing for a share of the upscale market with new packaging. Shenzhen Ganten and Nongfu Spring have both unveiled high-end glass bottling reminiscent of Perrier’s.

"Healthy and Cool? Packaged Water Sales in China Driven by New Consumer Preferences", South China Morning Post, November 03, 2017

Chinese Beverage Industry Honors Pepsi-Tingyi Bottlers For Conservation Efforts

Bottlers and other production plants that are part of the PepsiCo-Tingyi alliance beverage system in China were recognized for water and energy conservation efforts at the 2017 China Beverage Industry Association (CBIA ) annual conference recently. PepsiCo and Tingyi won nearly 40 percent of the total awards at the conference, continuing a tradition of industry awards over many years. This year, 20 alliance plants won Excellent Water Saving Enterprise awards, and 26 received Outstanding Energy Conservation Enterprise awards.

"PepsiCo-Tingyi Alliance Wins Big at CBIA 2017 Awards", Global Times, November 23, 2017

Tingyi’s Profit Growth Is Strong, But Adverse Trends Are In The Wind

Tingyi (Cayman Islands) Holding Corp, owner of the Master Kong brand of snacks, noodles, and beverages, said its third-quarter profit rose 30 percent to $186.6 million on $2.97 billion in revenue from a restated $144 million in profit a year ago. A Chinese partner of Starbucks and PepsiCo, Tingyi warned of short-term margin pressure partly because of rising raw material costs. Other pressures affecting profit include China’s changing economic development mode, industrial upgrade, and fast-changing consumer demand.

"China's Tingyi Q3 profit jumps, but margin pressure remains", Reuters, November 13, 2017

Asahi To Begin Selling Two Former AB InBev Brands In China

Japanese brewer Asahi announced it will begin marketing in China next spring two premium European beer brands it acquired in its deal with Anheuser-Busch InBev. Czech beer Pilsner Urquell and Italy's Peroni will be distributed mostly in Shanghai and other mainland cities, with marketing focused on younger drinkers who frequent upscale supermarkets and restaurants. It is expected that the brands will be sold at higher prices than Asahi's Japanese top-seller Super Dry lager, which costs three times as much as local Chinese brands.

"Brewer Asahi Bringing Pilsner Urquell, Peroni to China", Nikkei Asian Review, November 23, 2017

Hong Kong Coke Bottler Sees Major Shifts In Beverage Preferences In China

A Hong Kong-based beverage distributor and Coca-Cola bottler says Chinese consumers are incorporating concerns about health into their drinks purchases. Patrick Healy of Swire Beverages says Chinese beverage buyers are turning their noses up at classic sugary sodas like Coca-Cola and Fanta, instead buying premium bottled water and energy drinks. Healy says the trend began several years ago. Now traditional categories are seeing single-digit growth, compared to double-digit growth for the new categories. Industry observers say low sugar or sugar-free, and low calorie drinks will be the dominant trend in China. Swire has been a business partner with Coca-Cola since 1965, and is one of two major bottling partners of Coca-Cola China, along with state-owned China Foods.

"It’s Fewer Sugary Sodas, as Health Conscious Chinese Consumers Opt for Energy Drinks, Premium Waters", South China Morning Post, November 21, 2017