Bottled Water Growth Slows as Consumers Turn on the Tap

BASINGSTOKE, England - Latest Global Beverage Forecasts from Canadean

The combined forces of the economic downturn and environmental pressures
are causing a sharp slowdown in the global bottled water market, according to
a recent analysis by global beverage industry specialists, Canadean. The
situation is most marked in the USA, where Canadean is forecasting annual
growth of under 1% for the next five years. This is a significant
deceleration from the double-digit rates seen from 2000 to 2008, and has
major implications for the PET plastics industry, in particular.

“In the decade up to 2008, the US bottled water market accounted for 20%
of the growth in global PET demand in beverages,” comments Emily Neill,
Business Development Director at Canadean. “This growth driver has been
switched off, and the momentum in bottled water demand is now firmly focused
in the dynamic Asian markets.”

High profile tap water campaigns across many US states, and bottled water
bans by public institutions have resulted in consumers reverting to tap and
filtered water. This is being mirrored in some major European markets such as
France and the UK, with the economic conditions reinforcing this trend.

On a broader note, the prognosis for global commercial beverage
consumption is relatively healthy. Beverage demand is forecast to weather the
economic storm, growing by 2.0% in 2009 and 2.6% per annum in the longer
term. The more buoyant categories include still drinks, nectars (juice
drinks) as well as bulk and bottled water, where growth in countries such as
China, India and Indonesia will compensate for the stagnation in western
economies. After a near flat performance in 2009, carbonates are expected to
return to a growth rate of 2% annually. Those companies with strong
international exposure will benefit from rising demand in Asia to offset the
tougher markets in North America and Europe.

Alcoholic drinks are likely to show a mixed picture, with beer, wines and
spirits in gradual decline in Europe, where health and legislative issues are
hitting traditional alcohol consumption. The pattern is clear: beer and
spirits are in decline in their key markets such as Germany, the UK and
Scandinavia, whilst wine is under pressure in France, Italy and Spain.
Meanwhile, Asia will continue to be the engine for beer demand, with a
projected annual growth rate of around 5%.

More intriguingly, the energy drinks category grew at double digit rates
across a large number of countries in 2008, and is predicted to rise by
nearly 10% globally in 2009. Upsizing in serving volume, the entry of more
private label and B brand products, plus strong support from the
multinational players are all factors pushing up consumption. And evidently
in straitened times consumers are prepared to pay for that extra boost.

Global Commercial Beverage Forecasts - Selected Categories

Consumption Growth 2008 - 09F 2008 - 13F

% per annum
All Commercial Beverages 1.9 2.6
All Soft Drinks 2.2 3.1
Packaged Water 2.8 3.6
Carbonates 0.7 1.8
Energy Drinks 9.5 9.3
Dairy Drinks 1.3 2.2
Beer 2.2 2.8

Source: Canadean

This latest analysis comes from Canadean’s Global Beverage Forecasts
report. This report is based on analysis and data from Canadean’s global
network of country beverage specialists and provides forecasts for
consumption of all commercial beverages out to 2014. The report also includes
commentary and analysis for each beverage category in major markets.

Editor’s Note:

Canadean is the leading supplier of information, market research and
consultancy services to the global beverage and beverage packaging
industries.

With headquarters in the UK but with offices around the world, Canadean
has built a reputation as the benchmark for global beverage market
intelligence. Local operations are now based in Madrid, Buenos Aires, Mexico
City, Hong Kong, Beijing, Shanghai and Sydney.

Issued by the Corporate Marketing Department of Canadean Ltd, the leading
global beverage research company.

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Tel: +44-(0)-1256-394210
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Email: sales@canadean.com

For further information please contact Canadean’s head office on tel:
+44-(0)1256-394224 or email sales@canadean.com.

Website: www.canadean.com

Source: Canadean

For further information please contact Canadean’s head office on tel: +44-(0)1256-394224 or email sales at canadean.com.