AB InBev Efes will start producing hard lemonade with a strength of 4.5%

Due to the stagnation of demand for classic beers in the Russian Federation, large producers are expanding their range to include other items. AB InBev Efes will begin production of the so-called hard lemonade with a strength of 4.5% Garry Garden in the segment where Baltika’s Seth & Riley’s Garage is represented, the rights to which Carlsberg is trying to revoke. The emergence of a new major player in the category will lead to increased competition, primarily based on price, experts say.

AB InBev Efes plans to start production of Garry Garden Hard drink in Russia. The corresponding declarations of conformity were registered in December 2023, as follows from the RosAccreditation database. AB InBev Efes Marketing Director Maria Dementyeva clarified that we are talking about a new brand of hard lemonade (alcoholic lemonade). According to her, the drink with a strength of 4.5% will be produced in orange, lemon and raspberry flavors in lightweight 0.4 liter bottles at the company’s factories in Ivanovo and Omsk. The brand will be presented in the premium segment, and sales should begin by the summer season.

As Ms. Dementieva notes, sales of fruit beer are growing at the fastest rate on the market. This segment, according to NielsenIQ, ranks second in terms of the number of consumers, and the emergence of new products stimulates further growth in demand. Nikolai Zhelagin, founder of the “Take a Day Off” chain of beer stores, notes that beer sales in Russia are not growing noticeably, especially among young consumers, which forces producers to expand their assortment to include cider, mead and other drinks with different flavors.

The head of Volkovskaya Brewery, Alexey Aksel, explains that hard lemonades in the Russian Federation are prepared on the basis of beer wort, which is filtered until clear and supplemented with fruit fillings. Igor Khavsky, co-owner of the distributor SVAM Group and the Gletcher brewery, points out that the economics in the production of such drinks are good. According to him, the AB InBev Efes brand will compete mainly with Baltika’s Seth & Riley’s Garage, which is the leader in sales in the segment. In addition, the United Brewery holding (OPH; Dr.Diesel brand) and the Moscow Brewing Company (MPC; Max & Jack`s brand) have similar drinks.

Seth & Riley`s Garage belongs to the Danish Carlsberg Group, which, after transferring shares in Baltika to the management of the Federal Property Management Agency, terminated the agreement with the Russian company for some of the brands. Baltika, according to the file of cases, achieved in the Arbitration Court of St. Petersburg and the Leningrad Region the recognition of the unilateral refusal of agreements, including on Seth & Riley`s Garage, as invalid, and Carlsberg is appealing this. Meanwhile, in 2024, Baltika, according to the Federal Accreditation Agency, received a declaration for a fruit drink under the new brand Tony`s Garret Hard.

Baltika did not answer Kommersant’s questions about a possible new brand, saying that sales of fruity-sweet beer drinks in 2023 increased by 12% year-on-year, mainly due to the expansion of the range and the emergence of new players. The MPC and OPH did not provide comments.

The owner of the Kaufman brand agency, Stanislav Kaufman, says that if a new brand “does not have a unique idea,” then the company will have to compete through promotions, better shelf space, and distribution opportunities. This, he believes, will, in turn, encourage other market participants to invest more actively in promoting their similar drinks.

Anatoly Kostyrev