Habesha Brewery aims for 20% market share

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Habesha Breweries Share Company announced that it plans to capture 20 percent share of the beer market in Ethiopia

once its under construction brewery starts operation.
The announcement was made at a press conference organized in Intercontinental Addis Hotel on January 17, where it asserted that it envisions to launch its first    bottled beer by April 2014.
Yonas Alemu Marketing and Business Development Manager at Habesha Breweries S.C. said that Ethiopia’s beer consumption per capita is well below the global level, and Habesha in its medium term goal sees itself capturing 20 percent of the beer market in Ethiopia.
“We have many shareholders that are members of the Ethiopian Diaspora who want to see the products in foreign countries,” said Yonas adding that he sees no reason why it cannot start producing canned beer. “Though there should be first an industry that supports the proper use and recycling of cans to make it economical,” he noted.
Habesha Breweries S.C. also revealed that its total cost for the brewery it is building on a 7.5 hectares of plot in Debre Birhan city, 130 kms north of Addis Ababa, is expected to reach USD 43 million.
The construction project has already started in December 2012, with the civil works expected to start next month.  
Zewdu Negate Chief Executive Officer (CEO) at Habesha Breweries said he expects the Chinese firm Lehui Food Machineries that won the Engineering Procurement Construction (EPC) contract in September 2011 to supply 90 percent of the machinery, to complete the project within 15 months.
He also said that the location was chosen not only for Debre Birhan being one of the primary barley producing areas in Ethiopia, but also for the quality of its ground water. Habesha, meanwhile, expects up to 30 percent of its barley malt supply to come from local sources initially, with the rest to be imported.
Once completed Habesha Breweries plans to manufacture 300,000 hectolitres of beer annually expected to be increased to 500,000 within two years of its initial production phase. The brewery plans to produce 0.33 and 0.5 litres of bottled beer in its first stage.             
Habesha stated that there has not been a total redesigning of the project but an upgrading design for the plant was done, with a view of keeping its quality high while preserving the affordability and importance of the project.
Stijn Swinkels, Executive Director of the Dutch firm Bavaria N.V. said it expects its share to increase by 49 percent upon completion of the brewery, and hopes that its three hundred years old brand name would contribute to Habesha Brewery’s portfolio.
He also said it’s the company’s first investment in Africa and as such could become a stepping stone for future investments in the region and in the continent.  
Erik Van Noort, Director of Overseas Business Development of Lehui Group said this particular project is emblematic of good business cooperation of a company from Ethiopia with others in Europe and Asia.
“Beer isn’t just an alcoholic drink you consume, it’s an agricultural product fermented from barley, which contrary to perceptions is a local product,” said a representative of  Bavaria N.V. adding that the three centuries experience will ensure that Habesha Brewery will succeed in its endeavour.
Habesha Brewery currently has 7,867 shareholders, and authorized capital of about USD 13.7 million.
Ethiopia’s annual beer consumption grows at an average of 24 percent, according to research done by Access Capital in 2009. The estimated consumption of four million hectolitres in the country roughly translates into five litres per person annually, well below the average consumption of neighbouring Kenya (12 litres) and South Africa (59 litres).