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From Peas to Hemp, Dairy Companies Are Milking ‘Just About Everything’

Beverage producers are “milking just about everything,” says Senior Dairy Analyst Tom Bailey in his report titled, “Dare Not to Dairy: What the Rise of Dairy-Free Means for Dairy.” Firms that have invested in dairy alternatives have shown better returns as consumer demand for plant-based food and beverages grows, he told Bloomberg.

Craft Beer in Asia

Craft beer reached Asia in the early 2000s, nearly two decades behind North American and the European market.

Is Nestlé eyeing up Starbucks’ packaged coffee business?

Senior Beverage Analyst Jim Watson spoke with Food Navigator about why a tie-up between Nestle and Starbucks would make sense for both parties. “Starbucks has lots of growth opportunities through its digital rewards platform, food offerings in the US and store openings in China, but coffee beans in the retail channel is not a growth segment,” he said. “For Nestle, this can provide additional scale and help build out a more powerful retail portfolio to compete against the growing JAB companies.”

Limes Are Cheaper Just in Time for Cinco De Mayo. Avocados, Too

Higher lime prices are typical for March and April, and partly boosted by increased demand ahead of Cinco de Mayo, Senior Analyst Roland Fumasi told Bloomberg. The seasonal gains were exacerbated this year because of adverse weather in Mexico, but prices eased just in time for the May 5 holiday.

Rabobank eyes potential effects of NAFTA breakup

Senior Analyst Roland Fumasi predicted potential consequences for the North American produce trade if the U.S. pulled out of NAFTA. Fumasi said that if the U.S. were to withdraw from NAFTA, imports of fresh produce from Mexico and Canada to the U.S. would likely increase. “In that scenario, product flowing from Mexico to the U.S., and from Canada to the U.S., is going to be more price competitive and cheaper,” he said.

Trading wine for weed? Experts say trend likely to accelerate thanks to legal pot

Many experts predicted that the beer industry would be the alcoholic beverage most affected by the legalization of pot, as drinkers switched to weed to unwind at the end of the day. Global Beverage Strategist Stephen Rannekleiv, however, believed that wine drinkers, especially women, would be more likely to make the switch. “Young men are already smoking,” he told USA Today. “It’s the people who are more educated and affluent who are saying ‘if it’s legalized, I’ll give it a try.’ And that’s definitely the demographic of the wine consumer.”

After 124 years, Hershey tries to be more than just a chocolate company (again)

Chocolate maker Hershey moved to once again diversify its product portfolio in early 2018. Senior Consumer Foods Analyst Nick Fereday spoke with CNBC about how confectionary companies must look for growth opportunities in other food categories in order to stay competitive. “Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day’s trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they’re all looking for growth,” he said.

On the Money: Paying More [Video]

Senior Markets Strategist Christian Lawrence talks with CBC TV in Canada on the rising cost of living in the country. “When you look at the components that are driving prices up, it’s not really the consumers that are contributing to the inflation – it’s more on the supply side,” he said, citing the rising costs for gasoline, housing and internet access. “That really squeezes disposable income in a household and it’s going to squeeze consumption, preventing consumers from spending money on other things.”

Rising Cannabis Use Could Cut Into Wine Consumption

The wine industry could face competition from the legalization of marijuana, but hardcore wine enthusiasts are unlikely to change their consumption habits, Global Beverage Strategist Stephen Rannekleiv told Forbes. Rather, he expected that causal wine drinkers, who often pour a glass to unwind at the end of the day, would be more likely make the wine-to-marijuana shift. As a result, Rannekleiv predicted the under-$10 segment to see the most potential impact from legalization.

Dollar Extends Last Year’s Slide Into 2018

The U.S. dollar posted its fifth straight quarterly loss in April 2018, while the euro, the yen and other emerging markets currencies were up in the first quarter of the year.

If China Strikes Back – Potential Implications for U.S. Food & Agribusiness

After the U.S. government announced a package of trade sanctions on Chinese imports of around USD 60bn, China announced it would retaliate by targeting several U.S. agricultural products. So far, China has said it would impose a 25% tariff on pork and a 15% tariff on nuts, fruits, vegetables, and wine. At this point, the picture is not complete yet, but we can begin to evaluate the potential consequences based on current information.

Rabobank: Awaking the ‘sleeping giant’ of online alcohol sales

In their report “The Times They Are E-Changin’” Rabobank beverage analysts urged alcohol brands to carve out a space in the booming e-commerce channel. Many of the largest grocery retailers have scrambled to offer online options, creating an opportunity for alcohol brands to move their sales online as well. In fact, online alcohol sales could soon surpass online grocery sales overall, said beverage analyst Bourcard Nesin.

Grocery poised to grow online alcohol sales

Beverage analysts Bourcard Nesin, Steve Rannekleiv and Jim Watson believe the online grocery channel will develop into the most important driver of online alcohol sales, according their report “The Times They Are E-Changin’ – Where Alcohol Brands Can Win Online.” Large-format brick-and-mortar grocery channel accounted for 25% of beer and spirits sales and 44% of wine sales in the U.S., according to the report. “The data suggests that the share of alcohol sales coming from online, currently 1.6 percent, will eventually catch up to, or even surpass, grocery overall,” they stated.

Trade fears and dovish central bank limit Canadian dollar’s upside

President Donald Trump’s harsh rhetoric on trade and the renegotiation of the North American Free Trade Agreement weighed on Canadian assets in early March 2018. “Domestic data have soured somewhat and NAFTA negotiations may drag out far longer than previously expected,” said Senior Markets Strategist Christian Lawrence.

Challenging times for global dairy, but reasons for optimism

Senior Dairy Analyst Thomas Bailey discussed challenges ahead for the global dairy industry with Dairy Foods in early 2018. Despite uncertainty over NAFTA and a global milk surplus, Rabobank analysts remained optimistic about future dairy demand. “Some of the leading [market] indicators are pointing to solid expansion in 2018, and that’s going to translate into dairy demand,” Bailey said.

Michelob Ultra launches beer made with organic grains, strengthening appeal to core consumers

Michelob Ultra expanded its low-calorie portfolio with the launch of Michelob Ultra Pure Gold in February 2018, a beer made from organic grains and designed to appeal to health-conscious consumers. “Michelob Ultra has been successful by having a sharply defined brand identity, specifically through owning the exercise, outdoors and wellness space in beer,” said Senior Beverage Analyst Jim Watson. “An organic beer serves to strengthen this positioning and could even provide a halo effect to the core brand,” he told Beverage Daily.

Mexican peso is bracing for impact as Nafta talks and presidential election coincide

Senior Market Strategist Christian Lawrence predicted that a win by Andres Manuel Lopez Obrador in the Mexican presidential elections could prompt a selloff of the peso, especially because Obrador represented an unknown to market participants. “International markets don’t like populists, particularly if they’re not pro-business,” he told MarketWatch in February 2018.

Cold Brew Rising: A Dark, Rising Tide Elevates Cold-Brewed Dreams

The growth of the cold brew coffee sector transformed the coffee industry in 2017. The fact that major coffee players made efforts to consolidate their share of the market in 2018 was a promising sign of continued growth. “The more money and marketing you have behind this, the more you have big companies pushing retailers to open up new coolers to this segment, which is much better for everybody,” said Senior Beverage Analyst Jim Watson.

Flu Fears Halt a Long Decline in Orange Juice Sales

A particularly severe and widespread flu outbreak drove orange juice sales up 0.9% in early 2018, the first year-over-year increase in nearly five years, the Wall Street Journal reported. Consumer concerns about sugar content could be part of the reason why orange juice sales have stagnated. “Orange juice was long considered a healthy beverage,” said Senior Beverage Analyst Jim Watson. “It’s only in the last few years as concerns about sugar have picked up, that it has switched over to being considered an unhealthy beverage.”

Can Americans Eat More Chicken? U.S. Industry Bets on Growth

U.S poultry producers sought to expand their processing plants to increase output in early 2018. Still, some older plants may be closed as more efficient facilities are built, and not all the new capacity may get used if market conditions deteriorate, Senior Animal Protein Analyst Christine McCracken told Bloomberg.

Why we aren’t seeing a traditional flight to haven currencies as global markets swoon

While other U.S. equities tumbled in early February, the U.S. dollar achieved modest gains. “The dollar ended up taking up a lot of the haven flows, in part because people had been very short on the dollar beforehand,” said Senior Market Strategist Christian Lawrence. Short bets, or bets that the dollar will fall, can contribute to lifting the dollar as those bets are unwound, MarketWatch reported.

JAB’s Bart Becht looks to stir up US beverage market

Senior Beverage Analyst Jim Watson spoke with the Financial Times about the U.S. beverage market. “We are bullish on the potential for ready-to-drink coffee in North America and believe the new Keurig Dr. Pepper could be a real challenger to Starbucks/PepsiCo in this space. The same consumer buys hot coffee, cold coffee and soft drinks,” he said.

Canada FX Debt – C$ hits one-week low as job data boosts greenback

U.S wage growth surged in January, boosting the dollar’s value against other major currencies, Reuters reported. Expectations of another interest rate hike also contributed to the dollar’s rise. “I think the Fed is going to go in March,” said Senior Market Strategist Christian Lawrence. “Potentially we could see more members essentially calling for four rate hikes this year.”

NAFTA’s Dark Cloud Looms Over Canada Rates Rise

The Bank of Canada’s remarks on U.S. protectionism overshadowed news of its key rate hike in January 2018. Uncertainty over the future of NAFTA continued to “loom large” over both the Canadian loonie and the Mexican peso, wrote Roger Blitz in the Financial Times following the Bank’s decision. “This is a big change for markets who have been so used to low interest rates,” said Senior Market Strategist Christian Lawrence. “I think we will generally see a cautious approach from central banks.”

More big names leave the GMA: ‘It’s a breakdown in consensus,’ says Rabobank analyst

In December 2017, Unilever and Tyson Foods announced that they would not be renewing their membership with the Grocery Manufacturers Association (GMA) in 2018. The announcement followed similar declarations from Campbell Soup, Nestlé, Dean Foods and Mars. The exodus of big names from the GMA reflected a breakdown in consensus on issues such as GMO labeling and added sugars, Senior Consumer Foods Analyst Nicholas Fereday told Food Navigator.