City’s H1 beverage production drops

Friday, Jul 07, 2017 08:46

Tonic water being bottled at Thach Bich mineral water factory in HCM City. — VNA/VNS Photo Thanh Long

Growth in beverage sales in HCM City in the first half of the year slowed down to 2 per cent, according to the Department of Industry and Trade.

The department blamed the slowdown to prolonged cold weather and a series of downpours this year.

Demand for alcoholic drinks took a hit after consumption tax was hiked to 60 per cent last January as part of the Government’s efforts to curb consumption of beer and alcohol.

Besides, more and more consumers are becoming health-conscious and stopping consumption of sugary soft drinks.

This has only been accelerated by health-related scams: Authorities found high lead content in a drink while a consumer found a dead fly in another.

With a population of 90 million people, food and beverages is Viet Nam’s second most attractive sector after retail in the eyes of foreign investors.

HCM City has a total of 2,042 food and beverage producers with 300 new companies starting up every year.

According to a Government report, in 2011–17, the number of companies in the sector grew by 18.8 per cent a year.

According to the Viet Nam Industry Research and Consultant, beverage producers can rely on domestic sources of raw materials, which is seen as a huge advantage.

Thanks to this, a great variety of drinks have been introduced in the market, with bottled green tea, water and soft drinks accounting for the largest share.

Though exports of juices and other fruit-based drinks, mainly to Asian countries, have been on the rise in recent years, the domestic market is still the main one for beverage producers.

Despite the slowdown in the first half, experts are confident sales will gain momentum in the second half considering the demand for milk-based drinks and low-sugar and eco-friendly products. —VNS

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