From zero to 10 million hectolitres in almost ten years:
When the possibilities for a new beer brand were being stu
died in Brazil in the early 1980s, no-one could have suspected
that now, less than ten years later, total production capacity
for that brand would reach ten million hectolitres. Below: the
improbable story of Kaiser in Brazil, the brewery group in
which Heineken has a stake of some 12% and with which it
has concluded a technical agreement.
Doubling
Protection
A CERVEJA
Record time
Heineken beer
HEINt!
HEINEKEN INTERNATIONAL MAGAZINE NR24 PAGE 2
The amazing growth of the
Kaiser breweries
de Janeiro, J. de Deyn, does not
rale out the possibility of even
more breweries being built in the
years ahead.
But the success story was still
not at an end.Within fourteen
months a fourth brewery was
opened in Jacarei, close to the city
of Sao Paulo, with a capacity of 1.2
million hectolitres. HTB played a
major role in its construction bad-
vising on the brewery layout and
the required equipment. The bre
wery was originally planned for a
capacity of 600,000 hectolitres but
it was decided at a very early stage
in the construction to double this
capacity. By the end of this year the
Aerial view of the new brewery in Mogi Mirim.
For as long as people can
remember the Brazilian beer mar
ket (the biggest in South America
and, with its annual production of
almost 50 million hectolitres, cur
rently number seven in the world
league table of beer producing
countries) had been dominated by
two brewery groups which also had
soft drinks in their product range.
Both businesses flourished, but
they had one big problem. Particu
larly in the summer there was such
a heavy demand for beer that their
output was nowhere near big
enough to satisfy it. The breweries
tended to adopt the principle that
the customers who wanted beer
had to buy their soft drinks as well.
This development caused major
worries for soft drinks giant Coca
Cola. Having built up a strong
position in Brazil, it could see that
market share being severely eroded
by the competition from the brewe
ries. Within the local Coca Cola
Kaiiir
This is not a composite picture
from early this century but a photo
from 1980In that year this old
brewery in Mogi Mirim was still
fully operational. On the same site
a brand new brewery is being built,
yet without interrupting the pro
duction of the old one.
management and amongst the
Coca Cola bottlers plans were for
ged to build their own brewery and
to add a beer brand to their range
so as to improve their chances of
competing with the two big brewe
ries. Coca Cola headquarters in
Atlanta, USA, agreed with the
plans but insisted that an interna
tional brewing group should also
be involved.
Heineken was quick off the
mark when it became known that
the bottlers were on the look-out
for an internationally operating
brewery group. Marketing mana
ger C. de Soet explains why: "Par
ticipation in that project was and
still is attractive for us because it
gives us access to Coca Cola's out
standing distribution system which
we would like to use in due course
to introduce Heineken beer in Bra
zil."
In 1983 Heineken do Brasil was
set up and Mr A.B. Dorhout Mees
is permanently based in Rio de
Janeiro to represent Heineken in
the various breweries.
The establishment of Kaiser
took place at just the right
moment. The Brazilian beer mar
ket was growing very rapidly and
demand continued to outstrip avai
lable supplies because the two big
brewery groups were not able to
expand their capacity quickly
enough. An additional advantage
was that Kaiser could use the
excellent distribution organisation
of Coca Cola.
Five breweries were built in
record time. The first bottle of Kai
ser beer (developed by one of the
Coca Cola bottlers) emerged from
the new brewery at Divinópolis in
the State of Minas Gerais in April
Kaiser's success almost makes
us forget the reason for Heineken's
participation - to introduce Heine
ken beer in Brazil. Marketing
manager De Soet: "The Brazilian
beer market is complicated, as it
has no premium segment. Since
we certainly want to position Hei
neken as a premium beer, we will
also have to develop the segment
ourselves. Premium beers are
hardly known because imports of
foreign beers are not permitted,
except for sale via duty free out
lets, such as airport stores."
Heineken beer will therefore be
brewed locally. Heineken has rea
ched an agreement with the other
shareholders in the Brazilian bre
wery project, on the brewing of
Heineken beer under licence by
Kaiser. Partly thanks to the contri
bution of Heineken Technisch
Beheer the Kaiser breweries are
completely ready for that. Prepara
tions are currently being made for
the start of production and Heine
ken beer should be on the market
at the end of May.
A 1988 picture of the brewery in Jacarei. The brewery, with a starting
capacity of 1.2 million hectolitres, has meanwhile been expanded again
to 2.2 million. The brewery is designed for a total potential capacity of
8 million hectolitres!
1982. This brewery had a capacity
of 500,000 hectolitres a year. At
the same time as this brewery star
ted production, the construction of
a second brewery (in Rio de Janei
ro) was in full swing with assis
tance from Heineken Technisch
Beheer (HTB). That brewery, also
with a capacity of half a million
hectolitres, opened in 1983. But
more was yet to come. During the
same period building work was
also under way on a third brewery
in Mogi Mirim in the State of Sao
Paulo.
Early in 1984 L. Mengoli, cur
rently production manager at Birra
Dreher in Italy, was posted to Rio
de Janeiro as technical consultant.
One year later the total capacity of
the three breweries had reached
almost three million hectolitres!
Jacarei brewery will have a total
output of 2.4 million hectolitres.
In May 1988 a fifth brewery was
opened in the vicinity of Porto Ale-
gre in the south of Brazil. This bre
wery now has a capacity of 750,000
hectolitres. In the meantime the
brewery in Rio de Janeiro has been
expanded again, its the original ca
pacity of 500,000 hectolitres being
raised to 3.1 million this year.
At the present time Kaiser Rio
de Janeiro is busy in the province
of Bahia with construction work on
a sixth brewery with an initial capa
city of 400,000 hectolitres. And
the present HTB consultant in Rio
