Saying it's going back to its whole food roots, Jamba Juice unveiled expanded menu of smoothies made with such ingredients as kale, carrots, chia seeds and Greek yogurt. The 3 new Whole Food Nutrition smoothies, which complement existing Fit N Fruitful smoothie platform, are Kale-ribbean Breeze, PB Chocolate Love and Carrot Orange Fusion, each containing 10-14 grams of protein. Jamba plans to extend its fresh juice offerings in similar direction, at time of years consumers often make resolutions to lead healthier lives. "Made with whole fruit, whole veggies and other real whole food ingredients, our new smoothies and juices make it easy to start healthy habits in the New Year with truly good, straight from the earth ingredients," said svp/chief brand officer Julie Washington . . . Jones Soda said it entered a revolving secured credit facility with BFI Business Financing that enables the co to borrow up to $2 mil to support its US and Canadian operations . . . In characteristically exuberant year-end letter to associates, founder/ceo Eric Schnell said his MetaBrand's brand incubation co blew thru targets of its inaugural year: "we over-achieved our revenue plan by 20%, successfully exhibited at 4 industry tradeshows and currently have 23 active projects in our Lab of Creation led by some of the most exciting concepts and group of new-to-market brand owners I could imagine having the fortune to work with." Edison, NJ, firm has "even maxed out our office space with the most amazing team of 12 founding managers," Eric added.  

Interested in science behind soda makers' ardent quest to find all-natural sweetener that doesn't taste like feces? NY Times Sun mag offers sweeping panorama from Slate writer Daniel Egbert that takes readers from academic greenhouses to corporate development labs as it outlines efforts that so far have been consistently undermined by taste issues - as with sweetener made from one hoped-for miracle ingredient, South African molomo monate plants, that was employed in bottle of Sprite and left on roof over weekend, only to yield soda that "had turned urine yellow and developed the smell of feces." Article is careful to note lack of conclusive scientific data that currently used artificial sweeteners are harmful, but also documents swing in consumer sentiment that's made it tenacious issue for soda marketers anyway. Read article here.  

Tho several initiatives at state level to enforce GMO labeling and other anti-GMO policies have failed, consumers who're skeptical of genetic engineering have scored a modest victory in another forum: pressuring food marketer directly. General Mills has agreed to make main version of its Cheerios breakfast cereal from non-GMO ingredients after activist coalition GMO Inside orchestrated year-long consumer blitz that generated 40K Facebook posts and 25K emails calling on co to take step. True, since there are no GMO oats, core ingredient has never been at issue for original Cheerios sku's (tho 10 other Cheerios varieties use corn or other ingredients that might be grown from GMO seed, per facts page on cereal's Web site). Still, making non-GMO assurance required some rejiggering by Genl Mills. "We made investments in new systems at our production facilities to separate the ingredients we use to make original Cheerios from our other products," co states. "For example, we store only non-GMO corn starch where we store our corn starch, and only cane sugar where we store our sugar. And though there may always be some chance of some small amount of GM coming from some other source, none of the ingredients in original Cheerios are genetically modified."

In taking victory lap, GMO Inside calls it "huge victory" and notes, "As soon as the campaign launched, tens of thousands of consumers started flooding Cheerios' Facebook page with concerned comments regarding GMOs in Cheerios and used an app put out by Cheerios to spell out anti-GMO messages in the Cheerios font." Pressure kept building via Youtube video watched 200K times until announcement was just made. As for cereal maker's stance on issue in general, recall that it's been among marketers like Coke and Pepsi who've funded campaigns that defeated GMO labeling initiatives in Calif and Wash State, and on Web site it reiterates its view that "General Mills supports a national solution. There's a government-approved national standard for labeling non-GM products in Europe and in Canada, and General Mills believes a national standard for labeling non-GM products would benefit American consumers as well. We've long opposed state-by-state labeling laws." Keep in mind there's been no conclusive evidence that GMOs are unsafe - as detailed just this weekend in long front-pager in NY Times on GMO battle in Hawaii. But there's no question issue is attaining increased prominence among consumers.  

Waiting with bated breath for Pepsi's "structural" news announcement in coming weeks? Morgan Stanley's Dara Mohsenian is advising investors to keep a leash on it, because he anticipates little more than incremental cost-cutting initiatives. "We believe cost-cutting is likely given our analysis shows PEP still has cost-cutting potential left vs peers even after its current program, PEP has hinted at more cost-cutting, and we don't think the status quo is an option given PEP has promised action if NA beverage trends did not improve (which has not occurred)," he writes in note to investors (by NA he means North America). That's despite list of hypothetical options for N Amer that includes separation of bottling biz from marketing side, cost-cutting and/or joint venture or partnership, and, at corporate level, "a split-up, large acquisition or strategic partnership of some kind." True, PEP has acknowledged it's mulling refranchising, which Dara rates 2d-most-likely option, "but we do not expect a separation in early 2014 given NA beverage softness (both pricing and volume), which make current timing sub-optimal. PEP might also want to realize cost cuts from manufacturing rationalization and see benefits from pending sweetener innovation (which we think will be more evolutionary than revolutionary) before considering a refranchising." (So at least one influential Wall Streeter has trimmed his hopes for promised sweetener breakthrough, too.) Does that presage broad selloff by investors who, primed by Nelson Peltz's activism, are expecting more sweeping developments? Not necessarily, writes Mohsenian: at least in his own investor survey, only 29% expect a bottling separation so soon, vs 87% who expect incremental cost-cutting.  

Whole Foods Market is expanding popular low-interest Local Producer Loan Program by another $15 mil after exhausting initial $10 mil commitment with recent loan to SF-based soy yogurt producer. Since kicking off in 2007, LPLP has provided 184 loans to 155 local producers - in 2012 fiscal year that included 29 loans averaging $50K at 5.4% avg rate. Prior loans have run gamut from biodynamic farming and non-GMO animal feed to pollinator health and sustainable packaging. "Expanding the Local Producer Loan Program is a direct result of the innovations and successes of our loan recipients," said Betsy Foster, global vp of growth and biz development. Bevcos who've participated include Kombucha Botanica of Santa Cruz, Calif, Ritual Roasters (SF), Oogave sodas (Denver), Third Street Chai (Louisville, Colo), Fresh Bev LLC (a Conn maker of cold-press juices), Maine's Own Organic Milk Co (Augusta, Me), Buchi Kombucha (Asheville, NC), Red Jacket Orchards (Geneva, NY), Tumeric Alive (NY), Cascadia Tea (Portland, Ore) and Progress Coffee (among long list of recipients in Whole Foods' home base of Austin, Tex). To qualify, prospects work with team of WF loan administrators, buyers and local "foragers." Info here.  

Cold-pressed juice as coming megatrend? First Beverage Ventures has lent its imprimatur to notion by taking minority stake in year-old, SF-based Project Juice, one of growing array of high-pressure processing (HPP) players that are building network of retail stores along lines of, say, Organic Avenue in NY. Project Juice was founded by husband-and-wife team of Rachel and Greg Malsin (occupational therapist and investment banker, respectively) and their partner and investor Devon Briger. It produces in own facility in South SF, sourcing most ingredients from within 150 miles of SF to justify on-bottle promise that items are "Local. Cold-Pressed. Raw." Items that must be sourced from further away are still verified as organic. Co's lineup includes range of cleanses, cold-press juices and "nut mylks" under names like Dr Green Plus, Clean Green, Jala-Greeno, Beta Bomb and almond-based Mint Chip Shake and Turmeric Mylk. It also plays in cold-brewed coffee via Get Up & Go-Go sku. So far, it's opened store in Financial District, with Russian Hill and Palo Alto units on way in coming weeks, and is also served at simpatico retailers such as Fuel Café within downtown Equinox Gym, new coffee shop in Berkeley and Rainbow Grocery. Malsins hope to be operating 5 locations within year.

Founding trio - all ex-New Yorkers - bring interesting mix of backgrounds to project. Rachel Malsin has struggled with food allergies all her life and claims obsession with juice since age 16, flocking to pioneering juice presser Liquiteria in city. As occupational therapist working with autistic kids she focused on nutrition. Husband Greg comes from consumer investment banking at Piper Jaffray and Stockton Rd Capital. Briger, returning to career from mommy break, brings sales expertise from Microsoft, Starbucks and Kraft.

First Beverage partner Tom First told BBI that investment culminated search that probably put him in direct contact with 6 or 7 cold-press players as his team sought to understand dynamics of category: how reliant it is on cleanse function, how consumers are engaged, relative potential of retail, wholesale and e-commerce approaches. (Their conclusion: cleanse function is good "on-boarding" mechanism that draws some consumers into cold-press category, but their investment is not necessarily a bet that cleansing will be huge trend 5 years from now.) Of course, as delicate-to-produce refrigerated item that carries superpremium pricetag, Project Juice resembles First Beverage's most recent investment, in LA-based kombucha player Health-Ade, and represents gamble by investor that these sectors will be able to effectively scale up to national scope. Bill Anderson, founder of First Beverage Group, comes out of beer distribution sector, and team boasts deep expertise in production and distribution in consulting arm. Nantucket Nectars co-creator First, who's taken hands-on role at First Beverage's Purity Organic and Health-Ade investments, said that expertise will be on tap as needed by Project Juice, but stressed that co's investments represent bet on capability of strong founders to handle challenges of building their businesses. To First Beverage, Project Juice offered "3 outstanding founders and an incredible platform for innovation." As with Health-Ade, it was vital the product itself be "incredible," he noted. He hinted also that some cold-press players that had come up on First Beverage's radar were ruled out in part because they seemed to take cavalier approach to brand promises of raw, cold-pressed, etc. Particularly in environment like SF, he said, there's no wiggle room to compromise on these fundamental issues.

As for brand name, co's Web site at ProjectJuice.com notes: "We think of many things in life as 'projects.' A project to start eating better, to start exercising more often, to start spending more time doing the things we love. Project Juice is a personal project to incorporate cold-pressed juice into our everyday routines."  

As this issue shows, the high end is again leading industry growth. To stay on top of this trend, you won't want to miss the 2014 Beer INSIGHTS Spring Conference at the Ritz Carlton in Chicago. Once again, our focus will be on this dynamic and growing sector of the biz. Our program will feature an interview, moderated by BMI editor Benj Steinman, with the industry's current growth leaders: Crown prexy Bill Hackett and Boston Beer founder Jim Koch. Also from craft land, hottest craft brewer of recent yrs, Lagunitas founder Tony McGee. This yr, we're also featuring the return of consultant Mike Mazzoni; his provocative presentation on product life cycle at the 2011 conference is still being talked about. And consultant Bump Williams will lead a panel discussion with a handful of fast-rising craft brewers: Allagash founder Rob Todd, Ninkasi ceo Nikos Ridge, Odell ceo Wynne Odell and Devils Backbone founder Steve Crandall. David Kroll, MillerCoors innovations veep will talk about MC's recent big bets in the high end, like just intro'd Miller Fortune. More speakers to come. Per usual, BMI's Benj Steinman will present an overview of the segment, with plenty of numbers and insights. For more info, click here. To register, click here.   <A  

Here's new way to look at imports. Imports increasingly breaking out into 2 separate bizzes; Mexican imports healthy as a horse and "all other" imports collectively struggling in recent yrs (for a variety of reasons). Last yr, import shipments overall at 27.7 mil bbls, down 0.7% (tho STRs up). Imports still more than 1.5x as big as craft tho more than 3x as big as recently as 08. But composition of import biz has changed dramatically last 5 yrs. Mexican imports less than half of imports 5 yrs ago, now nearly 60%. Climbed from 47.1 share of imports in 2008 to 57.6 in 2013. Gained 10.5 share of segment and up 2.3 mil bbls. In Jan 2014, Mexican beers fully 60 share of imports and still gaining ground.

Outside of Mexican imports ? up 700,000 bbls, 4.6% in 2013 ? it's becoming a real struggle. Last yr, shipments from all other countries down nearly 900,000 bbls, 7%. For 5 yrs, shipments from all other countries dropped 3.6 mil bbls, almost 25%. Yikes. The big losses were Dutch imports, down 800,000 bbls, 14% and Canadian shipments dropped 1.15 mil bbls, 36%. They lost 5.1 share and 3.7 share respectively. Recall, some brands that were brewed in Canada switched to being brewed here in last 5 yrs, including Molson, Bass, etc. Beck's, Red Stripe and more also now brewed in US. There was also about 750,000 bbls of Blue Moon brewed in Canada back in 2008. Those brands are good chunk of decline. But fundamentally that part of import biz has waned, with relatively few bright spots.

So non-Mexican imports an 11.7 mil-bbl biz in 2013, down mid-singles. About 5.2 mil bbls, 45% of that was HUSA's Dutch and UK portfolio, which we figure fell around 5%. HUSA's Mexican portfolio healthy, up about 5%, but it wasn't enuf to make up for other import losses. Perhaps that's part of why HUSA emphasizing innovation and Strongbow more in 2014. The only big and growing brand in that other import biz is Stella, still up double digits to 1.6 mil bbls. But many of AB's smaller imports dropped precipitiously in scan data. Presidente, Franzikaner, Spaten and St Pauli Girl each down at least 20% in scan last yr. The DGUSA beer portfolio, at about 1.4 mil bbls, also dropped mid-singles, with Guinness down slightly, we estimate. Labatt Brands at about 1.2 mil bbls, down slightly in 2013, an improvement. Those big 4 players over 80% of that other half of imports. After those bigger players, there's less than 2 mil bbls left and despite some smaller individual brands that are doing well, ain't any big players gathering steam.

Gotta figure craft's success has bit into imports as well. Time was, a foreign locale had the most cachet among American consumers. And imports were the "more flavorful" alternative to mainstream domestic brands. Now, it's "local" that's leading in the cachet dept. And craft has grabbed much of flavor advantage too. What can non-Mexican imports do to get back their mojo?  

ABI execs have oft-stated that stopping share loss in US this yr is priority ("number one priority" said North Prexy Luiz Edmond in Nov at SAMCOM). And some analysts have forecast flat or even up volume for AB in US in 2014. But as of mid-March, both objectives look challenging. Indeed, volume growth for AB in US would be better than what ABI indicated on its conference call. Just read between the lines. While both Brazil and Mexico total beer mkts will return to growth, according to ABI, it only said it expects "improvement in trend in US." ABI did not say US would be up. In fact, specifically asked by a financial analyst if US total would be up, Brito responded: "We didn't say that." If AB isn't expecting US mkt to be up and its goal is to hold share, then it's not very likely to be up in US, unless mkt turns out to be healthier than AB presently projects. Still early days tho.

AB Losing 1+ Share in Measured Outlets First 2 Mos Getting to share "neutrality" will be more daunting, given AB's early 2014 results. In most measured data, AB lost 1 share or more so far in 2014. AB lost 1.1 share of volume and 1.7 share of $$ in Nielsen all channel data thru Feb 15, lost 0.9 share of volume in IRI multi-outlet +convenience thru Feb 23 and lost 1.4 share of volume in GuestSciences data on-premise for 4 weeks thru Feb 23. With share losses of about 1 full point thru 1st two mos, it will be that much more difficult to get back to even.

Big Drops for Black Crown, Lime-a-Rita and Beck's Sapphire Share "neutrality" also a challenge because AB's 2014 innovations don't appear poised to deliver as much incrementality as those in last couple of yrs. Most of its innovations from 2012-2013 are declining rapidly in scan data: Bud Black Crown down 44% thru Feb 23 in IRI MULC, Lime-a-Rita down 36%, Sapphire down 31%. Bud Light Platinum down another 10%, following 22% decline in IRI last yr. AB's got lotsa innovations that are incremental in 2014 too, but they are thus far smaller than those of last 2 yrs (Busch Signature, Mang-O-Rita, Raz-Ber-Rita, etc). So far in 2014 they don't make up for declining innovations of prior yrs. So to get to share neutrality, AB will have to achieve better base brand trends and/or a left-field new product hit. ABI is committed to spend to achieve better trends in 2014, projecting double digit sales and mktg increase worldwide. But will that spending achieve desired results? If AB not holding share, some expect AB will resort to discounting to achieve it, tho there's scant evidence of it so far.

Crown, Boston, Craft Growth Continues in Early 2014 Another emerging challenge will make it difficult for AB (and MC too) to hold share or grow. That's emergence of "predators" like Crown (now Constellation Brands Beer Division), Boston Beer and craft. Back in 2008-2009 when industry first started to decline, consultant Joe Thompson noted steeper AB and MC declines, but observed an absence of industry "predators" with enuf scale and strength to feed off volume AB and MC were shedding. That was true then. But in last yr or so, Crown and Boston each got on a roll. And craft growth got bigger than ever. All begin 2014 growing at even faster pace. In fact, at recent Gold Network Summit, Constellation Beers evp Bruce Jacobson explicitly referenced the "200 million case" opportunity for Crown, pointing to the volume he expects big 2 to shed in next 6-7 yrs and how Constellation is best positioned to pick up that volume.

As noted above, Crown grew 6% last yr, including double digit STR growth in most recent qtr thru Nov (see above). Even if it were to grow at same 6% this yr as last yr, that would amount to 800,000 bbls of growth. Boston Beer shipments grew 25% last yr to 3.4 mil bbls (depletions up 23%) including cider and tea. It's up 35% thru mid-Feb, but Boston estimates it will grow 16-20% in 2014. Considering its fast start and 25% growth last yr, Boston Beer likely to be up at least 18%, over 600,000 bbls, tho again not all beer. And craft grew almost 2 mil bbls in toto in 2013.

Where are we going with this? Crown, Boston and craft could add 3 mil bbls in 2014, meaning that if industry flat (a big improvement), those bbls gotta come from somewhere. Finally, "sales people sell what is easiest to sell," notes consultant Mike Mazzoni, noting that as such brands get scale within a distributor's operation, their growth at least to some extent "becomes a self-fulfilling prophecy." And they "grow at the expense of other brands in their house," which is "exactly what the big guys always feared." However AB chooses to address its share shortfall so far remains key question entering spring 2014.  

You really want to know what happened in US beer biz since 2008, when MC JV launched and AB bought by InBev? Doesn't get much starker than table below. US beer volume peaked that yr at 214.4 mil bbls. Since then, high-end segments expanded from 53 mil bbls to 66 mil bbls, and grew to nearly 1/3 share from 25. Offsetting that 13-mil-bbl gain, and then some: mainstream segments dropped 21 mil bbls, 13% and slipped from 3/4 of the biz to 2/3. There were modest yr-to-yr changes: subpremiums rebounded when downturn hit, premium lights held a little better in 2012, and so on. But march forward of premiumization and retreat of mainstream have been basically relentless. If anyone really sees reversal of those trends anytime soon, please call with details. Heavy high-end expansion happened even as biggest component of that segment flat to down slightly: imports. Well over 1 mil bbls of import volume back in 2008 is now domestically brewed and included with superpremium in our data, as we've noted in past. But Corona is half-mil bbls below its 2008 level and Heineken is 935,000 bbls lower. Biggest driver above premium has been craft, of course: up 7+ mil bbls, nearly 80% in 5 yrs. Meanwhile, superpremium biz up 3 mil bbls, with Mich Ultra, Platinum/Black Crown, Blue Moon/Leinie, plus those "domestic imports," pushing that number. Malternatives doubled, as Ritas, Redd's, Mike's and more far offset Diageo Guinness USA losses. In 2013, craft up almost 2 mil bbls, about 14% (higher than our original estimate and BA number likely to come in with even better trend), for 4th straight yr. Picked up 1 full share, breaking 2012 tie with superpremium category, which slowed to 6% growth. Import (shipments) flattish tho depletions a bit better, as we noted last issue. Malternatives jumped. Question remains: how high is up for high end?

Meanwhile, negative numbers across the board for premium and subpremium categories for both 2013 and last 5 yrs. Premium lights powered down by 10% over 5 yrs, shedding 8 mil bbls, 2.5 share. Premium regular brands hit even harder percentage-wise (about 20%) as Bud and Genuine Draft combined for near 8-mil-bbl, 30% loss while Coors Banquet and Yuengling grew. Subpremium trends just as ugly, as segment gave back all of the ground it gained in 2008-2009 in subsequent years. Subpremium light trends worse than full-cal, a reversal of situation in premium biz. Pabst Blue Ribbon is lone subpremium brand of any size to build volume since 2008, and even it slowed to 2% growth in 2013. Is bloom coming off that rose? No relief for segment in 2013, as each component of subpremiums off 4-5%. Subs down to 22 share of volume, well under 15 share of $$, since they have virtually no presence on premise (except PBR). These dropoffs in mainstream beer make AB and MC financial trends during this period look that much more remarkable. But they also raise key question of how long such volume erosion can go on before taking toll on earnings too.