Greece Food & Drink Report Q1 2014 - New Report Available

Greece has been battered by the eurozone sovereign debt crisis, enduring five years of economic contraction. The economic sentiment indicator published by the European Commission has surged in recent months, having languished near record lows in 2012. Even with the most recent data showing a slight deterioration, the sentiment indicator is still at levels not seen since 2008. This development has been mirrored across the board. Therefore, the outlook for consumer spending is now marginally better than it was a few months ago.

Full Report Details at
- http://www.fastmr.com/prod/723459_greece_food_drink_report_q1_2014.aspx?afid=301

Headline Industry Data (local currency)

* 2013 per capita food consumption = -3.8%; forecast compound annual growth rate (CAGR) 2013-2017 = +0.8%.
* 2013 alcoholic drink value sales = -2.3%; forecast CAGR 2013-2017 = -0.3%.
* 2013 soft drink value sales = -6.5%; forecast CAGR 2013-2017 = -0.6%.
* 2013 mass grocery retail sales = -3.2%; forecast CAGR 2013-2017 = +0.3%.

Key Company Trends

Companies Remain Committed To Greece Despite Outlook: Given the gloomy economic and consumer outlook for Greece, companies are likely to increase their focus on cost-reduction strategies. The question remains of how far they are prepared to go, as the political situation remains electrified. Nevertheless, some companies remain committed to the country. For example, in March 2013 the Greek division of Switzerland-based food and drink company Nestle dismissed news reports that it has asked the Greek government to make it easier to fire employees, reports Greek Reporter. Instead, the company reportedly has plans to invest around EUR8mn (US$10.4mn) into modernising its factories and developing new products.

Key Risks To Outlook

Uncertain Economic Outlook And Risk Of Deflation: Given the severity of Greece's economic depression (which has eroded demand-side price pressure) and the fragility of the global economy (which is weighing on commodity prices), we believe that the risks to our core forecasts are to the downside. Should the rate of economic contraction accelerate or local monetary conditions tighten even further, we warn that prices could fall beyond what we currently anticipate. There is also a lingering risk posed by global commodity prices. Should demand from fast-growing emerging markets, particularly China, slow sharply, commodity prices could undergo a significant correction, which would push down imported price pressure in Greece.

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