Boston, MA -- (SBWIRE) -- 06/24/2014 -- We expect household spending in Mexico to pick up in the coming quarters, as unemployment declines and consumers gradually adapt to new taxes that took effect on January 1. We forecast real private consumption growth to accelerate to 3.1% in 2014, up from 2.5% in 2013. Although the recently introduced tax on sugary drinks and the tax hike on junk food is likely to have a negative impact on the food and drink sector in Mexico in the short term, we maintain a favourable outlook for the domestic consumer, and declining unemployment and rising disposable income will ensure a robust expansion in the sector over the long term. Real private consumption growth will accelerate this year in Mexico as the impact of recent taxes on household spending fades.

Headline Industry Data (local currency)

- 2014 per capita food consumption = +8.6%; forecast 2014 to 2018 = +17.2%

- 2014 alcoholic drink sales = +7.8%; forecast 2014 to 2018 = +35.3%

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- 2014 soft drink sales = +5.6%; forecast 2014 to 2018 = +24.7%

- 2014 mass grocery retail sales = +7.4%; forecast 2014 to 2018 = +31.9%

Key Company Trends

FEMSA Investment Plans F or 2014 : In spring 2014 Femsa unveiled plans to invest USD1.35bn in its businesses during 2014. Femsa will invest USD850mn in its beverage operations, opening new factories and incorporating recent acquisitions, with the rest to be invested in its store operations, according to the company.

Walmex To Recover Through 2014 : Walmex is seen as a major bellwether for consumer spending in Mexico. However, it has not fared well over the past year or so, with sales at stores open for more than 12 months (same-store sales) having declined for three successive quarters. The latest setback has been reflected by the 2.4% year-on-year decline for the first-quarter period to end-March 2014. The comparables over the Q2-Q414 period are likely to be easier given the same-store declines in 2013. This, together with a brighter outlook for private...

The Mexico Food & Drink Report features Business Monitor International (BMI)'s market assessment and independent forecasts for food and drink expenditure, consumption, sales, and imports/exports and forecasts for the mass grocery retail sector. The report also includes analyses of major regulatory developments, the background macroeconomic outlook and competitive landscape comparing national and multinational companies by leading products and services, sales, investments, partners and expansion strategies.

BMI's Mexico Food & Drink Report provides industry professionals and strategists, sector analysts, business investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the food and drink industry and the mass grocery retail market in Mexico.

Key Benefits

- Benchmark BMI's independent food and drink industry forecasts for Mexico to test other views - a key input for successful budgeting and strategic business planning in the Mexican food and drink market.
- Target business opportunities and risks in Mexico through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.
- Exploit latest competitive intelligence on your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity) and Competitive Landscape Tables.

Coverage

BMI Industry View

Summary of BMI's key industry forecasts, and views, covering food and drink manufacturing and consumption and the retail market.

Business Environment Ratings

BMI's Food & Drink Business Environment Ratings provide a country-comparative Risk-Reward Ratings index aimed at investors, food and drink manufacturers and mass grocery retailers.

The ratings methodology makes sophisticated use of over 40 industry, economic and demographic data points.

Industry SWOT Analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the food, drink and mass grocery retail sectors, and within the broader political, economic and business environment.

Food Forecasts

BMI's food chapter is divided into sections such as Meat, Fish, Confectionary, Dairy and Canned Foods, and provides insight into a market's food industry, centred on a forecast to end-2018 for the sector. The chapter includes the following elements:

Industry Forecast Scenario - Historical data series and forecasts to end-2018 for growth of key indicators within a market's food industry. Including consumption, food consumption as % of GDP, canned food sales, confectionery sales and food and drink imports and exports, among others.

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