Latin America beer cans market set for growth
The Latin America beer cans market is estimated to grow at a CAGR of about 4% over the forecast period 2021 to 2026, according to a report by ReportLinker.
Latin America offers a massive opportunity for the growth of the market studied, as there is high alcohol consumption, and the region accounts for 18% of the beer consumption globally.
The adoption of sustainability with environmental measures is expected to drive the market. Cans are permitted in many places where bottles are typically not allowed, such as beaches, pools, parks, campgrounds, ballparks, golf courses, boats, etc.
Cans are 100% recyclable with other benefits such as much lighter than bottles, requiring less fuel to ship them, whether empty or filled, is an added advantage to it. An empty 12-ounce bottle weighs about 7 ounces, whereas an empty can weighs only about a half-ounce.
The government in Brazil is playing a significant role in boosting local beer manufacturing. For instance, the Communist party government collaborated with AmBev, the local subsidiary, and AB InBev to launch Magnífica, a beer that is both sustainable and affordable.
Further, the growing environmental concern in Mexico is forcing beer companies to adopt plastic-free cans. The brewer of Mexican beer, Corona, introduced a new can that does not use plastic ring carriers. The stackable cans are called Fit Packs and use zero plastic to screw together up to 10 cans in a stack.
However, the preference of consumers for wine might act as a challenge to the market due to the increasing affordability of wine and liquor products, and this shift is expected to continue, making more consumers shift towards these commodities.
Further, due to the COVID-19 pandemic, the consumption rate had fallen down due to the lockdown period.
Mexico has run out of beer due to factory shut down in pandemic. Beer stocks were depleted within a month, and in some areas, the prices of what was left doubled. With factory shutdown during the initial phase of lockdown, the demand for metal cans decreased drastically.
Also, the Mexican company Corona beer and Heineken has been temporarily halted production as the country declared a health emergency over the pandemic. The Mexican government ordered a suspension of all non-essential activities currently.
Further, in Brazil, in March 2020, Ambev SA announced it would use one of its Brazil beer breweries to produce half a million sanitiser bottles for public hospitals to fight the spread of coronavirus. This significantly led to the decreasing demand for metal cans.
Moreover, currently seeing the condition of the pandemic, in May 2020, Mexico City announced it would begin a gradual reopening of the beer shop, which reflects a smooth distribution channel as previously it was before COVID-19, and this shall provide a demand for the beer metal cans.