Vietnam’s beverage sector to grow strongly: Kantar World Panel

Vietnam’s beverage sector recovered in the third quarter of this year and is expected to grow strongly in the next phase, according to Kantar World Panel, a market analyzer.

In its Asia Pulse Q3 2022 report, Kantar World Panel noted year-on-year growth in spending was 4.9% in urban areas and 5.4% in rural areas of Vietnam, below the Asian average of 5.6%. Vietnam outperformed South Korea, Saudi Arabia, Indonesia, Thailand, Malaysia and was below the Philippines, mainland China, and urban India.

The beverage sector in Vietnam will bounce back after two years of slowdown amid Covid-19 restrictions, Kantar World Panel experts said. This is backed by the recent pacey spending growth, even higher than that in the Q3/2019, prior to the Covid-19 pandemic, they added.

Amid the positive development of the sector, major brands have been expanding their businesses in Vietnam. Heineken Vietnam will invest an additional $142 million in its brewery in Ba Ria-Vung Tau province in 2023-2025, raising its total investment in the brewery to $500 million.

Alexander Koch, CEO of Heineken Vietnam, said the investment would make the 130,000-can-per-hour plant one of the most productive among Heineken factories in the world, running completely on renewable energy and improving its water usage.

Coca-Cola Beverages Vietnam Ltd. organized a groundbreaking ceremony in October for its $136 million factory in the Mekong Delta province of Long An, its biggest in Vietnam. The 19-hectare facility, the fourth one in Vietnam, will apply smart technology toward a green and circular model, said Coca-Cola Vietnam CEO Peeyush Sharma.

Vietnam ranks third of six countries that spend the most money on bubble tea and similar ‘new tea’ drinks in Southeast Asia, at an annual $362 million, according to Singaporean consulting firm Momentum Works and payment startup Qlub.

Nestle Group’s flagship coffee brand Nescafé will invest over one billion Swiss francs (over $1.02 billion) by 2030 to help coffee farmers transition to regenerative farming methods and adapt to the climate emergency. The Swiss food and nutrition giant announced this ambitious Nescafé Plan 2030 in October, saying the initiative will focus on the brand’s suppliers in Vietnam, Brazil, Mexico, Colombia, Ivory Coast, Indonesia, and Honduras, where 90% of the coffee Nescafé sources is grown.

Kantar World Panel data shows Vietnam recorded impressive Q3/2022 growth in the fast-moving consumer goods (FMCG) sector of 9.1% in rural areas, the highest growth in Asia, and 3.8% in urban areas. The overall growth reached 6.45%, higher than the Asian figure of 4.2%.