Beer sales pick up (STZ)
In the four-week period ending August 20, beer category sales increased 4.7% with volumes down 0.1% according to NielsenIQ. YTD off-premise beer sales are up 0.3% while volumes are down 4.4%.
- Imports gained 1.7% points of share to 22.5% with sales growth of 13.4% in the four-week period compared to YTD growth of 8.2%.
- Domestic super premiums gained 0.2% points of share to 10.2% with sales growth of 6.5% compared to YTD growth of 2.3%. Premium regular growth of 3% in the month outpaced YTD declines of 1.2%. Premium light growth of 2.4% in the month outpaced declines of 1.4% YTD. Below premium grew 4.9% in the month outpacing the YTD decline of 1.5%.
- FMBs gained 1.2% points of share to 8.7% with sales growth of 21% in the four-week period compared to growth of 11.4% YTD.
- Hard seltzer lost 1.8% points of share to 9.3% with sales declining 12.2% in the four-week period compared to -10.2% YTD.
- Craft beer lost 0.7% points of share to 11.4%, but sales only declined 1.7% over the last four weeks compared to -5.9% YTD.
- The average price of a case of beer increased $1.30 to $28.30.
Constellation Brands is the growth story this year in the beer category. At-home beer sales are picking up, but is it at the expense of on-premise consumption?
Oat milk leads (STKL)
Plant-based milk sales grew 5.1% in the year ended June 12 according to IRI. Leading the category was broad based strength in oat milk. Refrigerated oat milk grew 53% YOY with unit growth of 47%. Planet Oat, Oatly, Chobani, Simply, Califia Farms, and Malk all grew over 50% in the oat milk category. RTD coconut milk grew by 1.1%, but units decreased 9%. Refrigerated almond milk decreased by 2.2%, but units fell 5%. RTD almond milk sales decreased 3%, but Silk and Califia Farms grew at least 13%. Refrigerated soy milk sales fell 7% with units down 10%. SunOpta reported double-digit growth in all of its plant-based milk categories in Q2 with oat and almond milk growth above 40%.
The good and the bad (APPH, KAL)
Indoor grow farming is seen by some as the future of farming. The facilities can use a fraction of the land and water in nearly any location, year round to grow crops. The facilities can grow plants without pesticides and traditional weather challenges, but they do have their own food safety risks. Last year the FDA said, “the moist, warm environments in greenhouses and similar CEA operations can help support the growth of bacteria, including pathogens often implicated in foodborne illness outbreaks.”
The indoor grow industry is also perceived as better for the environment, but it has its own challenges. According to a Science Direct study, growing one pound of tomatoes in a greenhouse result in a carbon footprint six times greater than tomatoes grown outdoors. According to Neil Mattson, who leads Cornell University’s controlled environment agriculture research group, “The carbon footprint is the main hurdle we have to clear.” Indoor grow may be the way more crops will grow in the future, but it is not the future for all crops or farming. It is also a terrible investment for public equities. AppHarvest and Kalera are on our short list.
