Market Challenge - High cost of ginger

One of the key challenges being faced by the global ginger beer market is the high cost of ginger. Ginger is the primary raw material used in the production of ginger beer. However, the cost of ginger has witnessed a significant rise over the past few years due to various factors. Ginger cultivation requires specialized farming techniques and laborers with appropriate skills. The availability of farming land suitable for ginger cultivation is also limited. These factors have contributed to tight supply of ginger in the global market. At the same time, the demand for ginger is increasing globally due to the rising popularity of Asian cuisines and natural health drinks. This imbalance between supply and demand has resulted in inflated ginger prices. For ginger beer manufacturers, the rising ginger costs have negatively impacted their margins. It has become difficult for them to price ginger beer attractively for customers without compromising on profits. If high ginger costs persist, it might discourage investment and innovation in the ginger beer market.

Market Opportunity: Product innovation & rising demand for natural ingredients

The global ginger beer market is poised to benefit substantially from the trend of product innovation and rising preference for natural ingredients among consumers, for instance, In July 2024, Heads of Noosa Brewing Co, a renowned craft brewery based in Australia, proudly announced the release of its inaugural Ginger Beer. This exciting new beverage is crafted using high-quality, Australian-grown ginger, showcasing the brewery's commitment to using local ingredients and supporting Australian agriculture. Ginger beer producers are innovating their products by introducing new flavors based on demand. For example, some manufacturers have developed ginger beer flavors infused with lemon, lime or spices like cinnamon to appeal to varying tastes. At the same time, health-conscious customers are favoring beverages with natural ingredients over highly-processed drinks. This growing demand for natural beverages acts as a major growth driver for the ginger beer industry. Ginger and honey are key natural ingredients present in ginger beer. The manufacturers' emphasis on using natural ingredients without adding preservatives or artificial flavors in their product development strategies has found favor with customers. This focus on product innovation leveraging natural ingredients is expected to open new avenues of growth for the global ginger beer market.