Posted 21/03/2011
By Veronica Smink
The traditional tea is prepared with dried leaves of yerba mate, a tree that grows exclusively in Misiones and Corrientes two provinces in the northeast.
So far, all companies selling yerba were from Argentina. But that changed recently with the arrival of international drinks giant, Coca-Cola, which in December launched its grass "La Vuelta" in some provinces.
Argentina is the leading global producer of grass and also the largest exporter, bringing the product to neighboring Uruguay, Brazil, Paraguay and Chile.
Its main external destination, however, is Syria, which receives almost 70% of exports from Buenos Aires.
Although in the past five years, exports have increased grass about 75%, production for overseas is still small, reaching just over a tenth of what occurred.
Meanwhile, domestic consumption takes up most of the harvest: 87% in a business that historically has operated as an oligopoly.
"90% of the herb is marketed by ten companies," he told BBC Raúl Karabe, director of the National Institute of Yerba Mate (INYM). New attempt
Coca-Cola spokesmen told the BBC that the foray into this market is part of the "innovation strategy" of the company.
"We wanted to offer a new option spread in a very traditional segment, which connects with contemporary culture in a fresh and fun," said Silvia Bianco, head of communications.
is not the first time that the multinational is interested in the mate market.
created in 2003 "Native" a drink gas produced on the basis of grass leaf extract.
The company had invested nearly $ 1 million in the project, which bore no fruit.
Now, Coca-Cola has decided to compete directly in the herb market, echoing the strategy the company adopted in Asia, where he launched another popular local tea: tea. Shortly
growth in Argentina is estimated in the herb business generates about $ 750 million.
How much potential is the traditional drink, as for a major multinational in the world are interested in this market? Experts consulted
hereby agreed that growth potential in the local market are bounded.
"Domestic consumption of mate is very stable," said economist Carolina Schuff, sector analyst at consultancy Abeceb.com grass.
"There is much room for growth in the country," agreed Karabe, who explained that most mate drinkers are fiercely loyal to a brand of grass, which often consume a lifetime.
where if there is room for development in foreign trade, they said both.
"I believe that the interests of Coca-Cola is out," said INYM expert. Limitation
Although the trend shows potential in the field of exports, even then the chances of growth are subject to a basic problem: production.
"The yerba mate grows only in areas with very specific climates and terrain, and it takes seven years from planting until harvest the tree, so that increasing production is very difficult," said Karabe.
Schuff numbers account for these limitations.
Despite the increase in external demand, in 2010 the production of grass grew only 1.56%, the biggest increase since 2005.
Source: BBC
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