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Ingredion, a supplier to food manufacturers as well as brewers, reported earnings on August 4.
The company’s results were negatively impacted by declines in the food away from home sector as well as the government mandated shutdowns of beer manufacturing in Mexico.
Ingredion expected the shutdown to be lifted by the end of May, but “they continued pretty much through the entire quarter, which was very surprising for us.”
The CEO also said, “Brewing’s steep decline pressured net sales for Mexico in the quarter and while June and July sales to brewing in Mexico have picked up substantially, recovery of our overall volumes to prior year levels has not yet developed.”
Ingredion’s CEO said the sales improvement has continued into July. “The government mandated brewing shutdowns [in Mexico] hit us very acutely because those breweries were just shut down and could not operate. Now, that’s been lifted and we’re seeing the volume… coming back very shortly, with July up, even versus the prior year.”
Earlier in the week Heineken expressed more caution on Q3 trends in Mexico noting that the end of Q2 had the benefit of restocking.
