"Romania Food & Drink Report Q2 2013" now available at Fast Market Research

From: Fast Market Research, Inc.
Published: Thu May 30 2013

We continue to hold a broadly pessimistic outlook on Romania’s economic performance in 2013. On the consumer front, weak consumer credit conditions are likely to dampen household consumption over the next few quarters. Additionally, food inflation has been rising in recent months, placing further downward pressure on discretionary spending. As food prices comprise more than 33% of Romania's consumer price basket, their effect on overall inflation levels and wider economic trends is significant.

Headline Industry Data (local currency)

* 2013 per capita food consumption growth = +4.83% year-on-year (y-o-y); forecast compound annual growth rate (CAGR) to 2017= +5.42%
* 2013 alcoholic drinks sales growth = +5.00% y-o-y; forecast CAGR to 2017= +5.51%
* 2013 soft drinks sales growth = +5.11% y-o-y; forecast CAGR to 2017= +6.95%
* 2013 mass grocery retail sales growth = +8.73% y-o-y; forecast CAGR to 2017= +10.53%

Full Report Details at
- http://www.fastmr.com/prod/589225_romania_food_drink_report_q2_2013.aspx?afid=303

Key Industry Trends And Developments

Rewe Expands Discount Store Footprint: In February 2013, Romanian food retailer Rewe Romania, part of Germany's Rewe Group, opened its new XXL Mega Discount store in the Romanian city of Galati. The move is part of the company's strategy to expand its presence in Romania. The latest store opening comes five years after the company opened its first outlet in Brasov in March 2008. The outlet – the seventh such store in Romania – was opened on premises formerly occupied by a Billa outlet. Overall, Rewe is expected to open 14 Penny Market and XXX Mega Discount stores over the course of 2013.

Encouraging Performance For Coca-Cola Hellenic: In 2012, Greek bottling company Coca-Cola Hellenic Bottling Company sold 162mn unit cases in Romania, which was 1% higher y-o-y. The growth was attributed to strong sales of Coca-Cola Zero and the addition of Nestea Plum, which boosted the tea category. Overall volume sales in Romania were the third largest among the company’s emerging market portfolio, following 371mn unit cases in Russia and 181mn in Nigeria.

Key Risks To Outlook

Political Instability Persists: We expect political instability to continue posing significant problems for Romania over the next few quarters despite the landslide victory for Prime Minister Victor Ponta’s Social Liberal Union in parliamentary elections in December 2012. In particular, we expect persistent corruption allegations and ongoing austerity to weigh on the country's political outlook, and thus on its investment potential.

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