Check out all the wine drinking going on.

Two-thirds (67 percent) of Americans surveyed said they partake in wine on holidays and special occasions while at home, while another 58 percent drink wine at home with dinner on an ordinary night, according to consumer trend tracker Mintel.

The wine market has grown 20 percent from 2004 through 2009 despite the recession, but at the peak of the slowdown in 2008 it declined 3.2 percent, Mintel said. With consumers slowly feeling better about the economy, the firm expects the wine market to increase by 2.1 percent this year.

“The future of the wine market looks bright, at least for moderately priced segments,” Mintel senior food and drink analyst Sarah Theodore said in a statement. “Value wines have helped consumers rethink their perceptions about wine.”

And how does wine stack up vs beer?

Mintel said so far this year nearly half (47 percent) of survey respondents say they drink beer compared to 35 percent who drink imported and domestic wines. Champagne and sparkling wines are next at 17 percent, followed by port, sherry and dessert wines at 7 percent.

Certainly wine was on the minds of analysts and executives on Hormel’s earnings conference call on Tuesday.

Hormel, whose foods include Jennie-O turkeys, usually reports its fiscal fourth-quarter results days ahead of Thanksgiving. During Tuesday’s call, Credit Suisse analyst Robert Moskow asked a follow up question — well, really, he gave more of a plea.
 
“I’m just trying to encourage Tim Ramey to call in with a wine selection for Thanksgiving,” Moskow said, referring to a D.A. Davidson analyst, who also follows Hormel and has offered wine pairings with Hormel foods on the call in the past. 
 
“It’s a Thanksgiving tradition. I don’t know where Tim is today,” replied Hormel CEO Jeffrey Ettinger.
 
“Don’t you guys have anything you can throw out our way? I’m more of a Diet Coke fan,” joked Moskow.
 
“I think just as long as you go with a Jennie-O Turkey, or a Cure 81 ham, we have that part of the meal covered,” Ettinger said.
 
When the call wrapped up, Hormel’s director of investor relations, Kevin Jones, offered up some pairing advice. “In response to Rob’s question, a good new Beaujolais, a Chardonnay, or Pinot Noir will go very well with a Jennie-O turkey, and either a Pinot Grigio or Riesling with the Cure 81 ham.”

Rising wine consumption goes nicely with reduced salt intake. Last week, Mintel said in its predictions for consumer packaged goods in 2010 that sodium reduction was poised to be the next big health push.

Also in the basket:

British union to meet Kraft over bid for Cadbury

Tiffany profit beats; view raised ahead of holiday

Wal-Mart has not applied for retail stores-India minister

Starbucks eyes China as next major market

Cheap and Cheerful for the Holidays (New York Times)

(Additional reporting by Jessica Wohl)

(Reuters photo)

Check out the return of the “BUD” stock trading symbol.

Anheuser-Busch InBev shares will start trading in New York on Wednesday as U.S.-listed shares, or American Depositary Receipts under the former Anheuser-Busch symbol, a nod to its Budweiser beer label. The return to the New York Stock Exchange comes 10 months after Belgium’s InBev acquired the iconic U.S. brewer and moved its primary stock listing to Belgium.

Anheuser-Busch InBev was formed late last year when InBev, the Belgian maker of Stella Artois and Beck’s, bought St. Louis-based Anheuser for $52 billion to create the world’s largest brewer. Since then, the company announced plans to open an office in New York and has begun reporting quarterly results in U.S. dollars, signaling a greater interest in the U.S. equity market, analysts said.

Investors can only hope the BUD shares will trade as well as Anheuser-Busch InBev shares in Europe, where they have more than tripled in value since late November.

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Blockbuster to close up to 960 stores by 2010-end

FEATURE-Beauty booms as Brazil consumers shrug off crisis

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Recession Dims Stars’ Style Power (Wall Street Journal)

Istithmar Vows to Support Barneys as Rumors Swirl (WWD, subscription required)

(Reuters photo)

Cheap beer-like drinks are in fashion as suds lovers try to hold onto their daily treat while saving money to ride out tough economic times. Sales of these drinks have been very strong and beer makers are aggressively marketing their products, all of which is just going to further dent the market share of beer, which has been in steady decline for years.

Nowadays, a 350ml can of regular beer will set you back about 210 yen ($2.20) in Japan, while low-malt "beer-like drinks" go for around 130 yen. 

Under Japan's tax code, beer is defined as having a malt content of two-thirds or more of the raw material and carries a liquor tax of 77 yen per 350ml can. The tax on the new drinks is only 28 yen, since they use no malt. Instead the beer makers use pea protein or other materials to create a beer-like taste.

Total shipments of malt-free drinks jumped 30 percent in June, industry data showed, while those of beer were almost flat.  Today, malt-free drinks account for nearly 30 percent of what used to be the beer market.

The brief history of beer-like drinks is that of a hide-and-seek game between breweries and tax authorities, which have desperately tried to protect sacred tax revenue. In 1994, Suntory released a drink with 65 percent malt content, pioneering a category called "happoshu" (literal translation = sparkling booze), offering a cheap alternative to beer. But two years later, the government, after seeing the growing popularity of such "tax-saving" drinks, lifted taxes on low-malt alcohol beverages, prompting breweries to release new products with even less malt to flee the cheaper liquor tax category.

But the taxman just wouldn't give up. The government raised liquor taxes again in 2003 so that the ultra low-malt booze would not enjoy much of a tax advantage. Then came malt-free drinks, brewers' answer to the tax authorities' tenacious chase.

As a beer purist, I've been sticking to real beer, but I tried a couple of popular brands of malt-free drinks recently for this blog. To be honest, they tasted too light and didn’t have much flavour to me.

But when I I told one of my colleagues what I thought, she replied: "Of course, that's how you should feel." A regular drinker of beer-like drinks, she added: "Don't drink them like beer, drink them like something totally different, like carbonated alcohol drinks. Then they're not so bad as a dinner companion."

Photo credit: REUTERS/Toru Hanai

With so many forecasters talking about the 2008 holiday season in extremes (the weakest since 1970, one of the worst in modern times), it’s refreshing to hear an executive suggest that, ok, things were not great, but they weren’t horrible either.

That assessment came on Wednesday from Rob Sands, chief executive of Constellation Brands, when the world’s largest wine producer and maker of Robert Mondavi, Vendage and Ravenswood wines reported third-quarter earnings.  

Sands, whose company also sells spirits and beer, said beer sales growth was accelerating due to the recession, while sales of spirits were getting hurt the most.

Following is an excerpt from a conference call CEO Sands and his management team hosted with analysts in which he discusses the impact of the recession on sales of alcoholic drinks:

          In the United States, market conditions remain pretty healthy as measured by consumer take-away … for the wine business. The spirits business has probably been impacted to the greatest extent with growth … getting near flattish … The beer business has actually accelerated in general during the economic downturn.

Regarding the holiday season, Sands said:

          In the US in particular for beer it wasn’t necessarily a stellar holiday season, but a lot of the IRI data (which tracks sales of packaged goods) that is being quoted is (through) 12/28, whereas last year it was through 12/30 … One of the things that characterized this holiday season is consumers definitely waited until the last minute to do their shopping. So, on beer I think that in the end it will probably wrap up to not be a fantastic holiday season, but on the other hand, I don’t think that it is going to wrap up to be as bad as the … currently published IRI data suggests. 
    
          On wine … anecdotally from our wholesalers … it appears … consumer take-away was pretty good over the holiday season. So when everything is reconciled we are hopeful that it is going to look pretty good. 

(Photo: Reuters)

Check Out Coca-Cola Enterprises feeling the pinch as cash-strapped consumers buy fewer soft drinks.

The world’s largest Coca-Cola bottler cut its full-year outlook on Thursday, even though third-quarter results met Wall Street’s view.

“Our performance remains below our expectations as we work through a combination of significant marketplace challenges, including a weakened North American economic environment, changing consumer purchasing patterns, and the impact of volatile fuel costs,” Chairman and Chief Executive John Brock said.

Brock said his company is working on its fundamental business review and would divulge details of that plan in December.  The bottler now expects to earn $1.25 to $1.29 per share this year, excluding items, down from a previous forecast of $1.40 to $1.45 per share.

Meanwhile, Danish brewer Carlsberg said its French subsidiary, Brasseries Kronenbourg, would cut 214 of its 1,400 employees as it works on restoring profitability.

The French beer market has been declining for many years and even market leader Brasseries Kronenbourg is losing market share, hurt by strong legislation and the general economic slowdown, Carlsberg said.

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RadioShack posts higher quarterly profit (Reuters)

Altria profit beats estimates (Reuters)

An Ironic Look for Lean Times: Extreme Banker (WSJ)

(Photo/Reuters)

When Jim Koch decided to start making Sam Adams beer in 1984, he raised $140,000 from friends and family, pooled that with $100,000 of his own money, and set a target. Within 5 years his Boston-based brewery would cook up 8,000 barrels of beer a year.

Twenty-four years and a stock IPO later, Boston Beer Co is selling nearly 2 million barrels of beer a year and is poised to become the largest U.S.-owned brewer. Assuming InBev’s takeover of Anheuser-Busch goes through.

When the St. Louis-based brewer of Budweiser falls into foreign hands, it will be the third of the big U.S. beers to do so, following Miller’s combination with South African Breweries and Coors’ tie-up with Canada’s Molson Inc.  

The Anheuser buyout puts Boston Beer in a bizarre situation.

“Like your kid’s Little League team winning the World Series because nobody else showed up,” Koch said. ”Anheuser-Busch spills more beer than we make.”

“We’ve gone from being invisible to infinitesimal all the way up to tiny. We’re not even small yet,” Koch said of his company, which now makes nearly 2 million barrels a year and has 0.8 percent share of the U.S. market. The company has a market capitalization of $576.3 million, based on the latest available share count.

Another interesting consequence of consolidation is what Koch called a “complete role reversal for American beer”.

“When I started making Sam Adams, they (American brewers) owned the quantity part of the market, but not the quality part. Today, these large foreign-owned breweries now have the quantity part of the market and the American brewers — Sam Adams and our fellow craft brewers – own the quality part,” he said.

Koch, a sixth-generation master brewer, says that despite Boston Beer’s catapult, it is still a ”craft brewer” since it is small, independent and traditional. But he is not married to “small” forever.

“I would love the day to be that we’re so big that we have the distribution and presence and magnitude of a Coors..maybe the day will come in a hundred years, because everyone started small. Maybe in a hundred years you’ll be able to get a Sam Adams in all the places you can get a Bud or a Miller or a Coors,” he said. 

 But will a founding father of the craft beer movement ever take a short cut and sell out to one of the big guys?

No comment.

(Photo: Reuters)
    
 

Anheuser-Busch’s “Cuba defense” against a takeover by Belgium-based InBev may have gone flat after the Budweiser folks agreed to be bought out, but don’t expect to see America’s top-selling beers in Havana bars any time soon.  

InBev brews and sells Beck’s, Bucanero, Cristal and Mayabe beers in Cuba through a 50/50 joint venture with the Cuban government. Could Cubans now be one mambo step closer to cracking open a cold Bud on a hot Havana night? 

Not so fast, says Uncle Sam.

According to a U.S. embargo against Cuba “no products, technology, or services may be exported from the United States to Cuba, either directly or through third countries. This prohibition includes dealing in or assisting the sale of goods or commodities to or from Cuba, even if done entirely offshore.” 

Exceptions include things like medicine, food, agricultural products, works of art or publications. 

“There will not be any Bud in Cuba. That’s a business that doesn’t exist now and it will not exist in the future until the regime changes,” said Todd Malan, president and chief executive of the Organization for International Investment, a lobbying group that represents U.S. subsidiaries of foreign companies.

But talk to enough people in Cuba and someone will remember when Budweiser was sold there. A waiter at Havana’s landmark Hotel Nacional recently said the last time he saw it was in the early 1990s –  right about the time the Soviet Union collapsed and Cuba’s economy, heavily subsidized by Moscow, went south.  

But Corona, whose brewer Grupo Modelo is half-owned by Anheuser, is generally sold in hotels, restaurants and some stores that cater to foreigners.

Average Cubans tend to know Corona’s name and some say they have seen it occassionally, but it is not their everyday choice. That would be one of InBev’s beers.

A can of Cristal or Bucanero at stores costs at least 1 CUC - the Cuban hard currency worth slightly less than a dollar. Given that the average Cuban makes about $18/month, beer is a luxury.

Bottles of Cuban rum — which include Pernod Ricard’s Havana Club — start at around $3 and go up from there. 
     
A DEAL OBSTACLE? 

Before a higher bid lured Anheuser into negotiations, the Budweiser maker sued InBev, saying the maker of Stella Artois and Becks may be lying when it promised to manage the combined company’s North American business from its hometown of St. Louis, since its Cuban business would make that impossible.

But InBev could take a cue from France-based Pernod, which also owns Wild Turkey bourbon, made in the United States. It does not sell Havana Club in the U.S. or Wild Turkey in Cuba. Its business in Cuba is completely separate from the U.S., according to Mark Orr, Pernod Ricard USA’s vice president for North American affairs.

He guessed that if regulators hassled InBev over its Cuban ties, the maker of Stella Artois and Beck’s could save itself by making sure that the Cuban venture was managed separately from anything going on in the U.S.

“I have no personal knowledge about how their business is currently structured, but I think they could do it fairly easily because everybody else has managed to do it in the appropriate way,” Orr said. “They are smart people and I’m certain they’ll do the necessary thing to comply with the law.”

InBev sells less than half a percent of its total beer volume in Cuba, according to a spokeswoman. Therefore, lawyers have said, it’s likely that InBev would swiftly sell it rather than have it impede its $52 billion takeover of Anheuser-Busch.   

And if the Castro dynasty were to end? Expect the “King of Beers” to be paraded through the streets of Havana, Clydesdales and all. 

(Additional reporting by Jeff Franks in Havana) 
     
(Photos: Reuters)   

Check out things looking hostile in InBev’s bid for Anheuser-Busch.

InBev, spurned so far in its attempt to acquire the maker of Budweiser and Bud Light, filed papers with the Securities and Exchange Commission that would lead to Anheuser shareholders voting on the future of the U.S. company’s board.

The Belgian beer maker also unveiled its own proposed board that would include Adolphus Busch IV, an uncle of Anheuser’s current chief executive. Makes you go Hmmm…

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Check out signs of possible acrimony in InBev’s takeover bid for Anheuser-Busch.

Could InBev be bringing a new flavor — Hostile Light — to the beer wars as it pushes forward with its $46.3 billion takeover bid for the maker of Budweiser?

On Thursday, InBev reiterated its preference for a friendly combination that would create the world’s biggest brewer but filed suit to establish that Anheuser’s shareholders could remove their entire board, possibly setting the state for a more contentious battle.

Anheuser, which rejected InBev’s bid on Thursday, said on Friday that it will challenge its would-be acquirer’s lawsuit over the board removal.

Still, some say the door is open to a friendly deal. Stay tuned.

Also in the basket:

Anheuser-Busch sees year profit above Wall Street views

U.S. consumer confidence falls in June

Lovefest with SUVs is over, thanks to high fuel prices

(Photo: Anheuser-Busch)

Check Out more news from the Anheuser-Busch front.

The company, which owns half of Mexico’s Groupo Modelo, said Modelo’s chief executive Carlos Fernandez resigned from Anheuser’s board, even as the American beer company tries to thwart an unsolicited takeover bid from Belgian-Brazilian brewer InBev NV.

Modelo is an important player here — it has been approached by Anheuser about a possible combination, according to the Wall Street Journal, while Reuters’ sources, who are familiar with the situation, have said that InBev also courted the Mexican company.

Separately, Anheuser also said that it will acquire the remaining 50 percent stake of the Crown Beers India Ltd joint venture from partner Crown International.

Crown International and Anheuser formed the Crown Beers India venture last year to distribute Budweiser and Armstrong, a beer developed specifically for India, throughout southern and western India.

Also in the basket:

InBev: US Anheuser breweries to stay after merger

EU raids detergent firms on suspicion of price fixing

Retail companies mull tactics ahead of holidays

Trying to hide price hikes with trends, fabrics

Clothing makers see fashion in color, detail

(Photo: Reuters)