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Magners soars to the bottom of the barrel
John Mulligan



THE success of C&C's Magners cider brand has prompted the company to more than treble its demand for apples next year in a bid to cope with soaring sales.

This year the company is expected to press about 50,000 tonnes of apples at its facility in Clonmel. It has told growers that next year it will require 160,000 tonnes.

That would represent 320 million litres of cider. C&C currently has capacity to produce 240m, but is building a 25m extension to its Clonmel plant.

So eager is the company to secure apple supplies that, in presentations to Irish growers, it has been offering guaranteed prices for the next five years.

The runaway success of Magners, which is sold as Bulmers in Ireland, is also forcing C&C to source increasing volumes of apples from the UK, France and Holland. One grower said last week that C&C is currently sourcing about one third of its apples from the UK, while another grower told the Sunday Tribune that this figure will have to increase if C&C is to meet demand. The use of so many apples from outside Ireland is at odds with the strong Irish image cultivated for Magners and Bulmers, but is unlikely to affect consumer perception. Senior managers from C&C were unavailable for comment last week, but a spokeswoman said that the company tries to source as many apples from Ireland as possible.

C&C initially introduced Magners into the Scottish market in late 2003 and within two years commanded a 24% share of the country's market. It was launched in London early last year backed by an initial 7.5m advertising campaign. Sales were stronger than expected and C&C ramped up the launch to the rest of England.

Last month, C&C said robust Magners sales had caused revenue and profit to "significantly" beat expectations this year.

The drinks maker said in May it aims to double its share of the UK cider market to about 1% this fiscal year. Liam Igoe, an analyst with Goodbody Stockbrokers said in a report this month that Magners' share of the UK cider market will probably rise to more than 5% "shortly after 2010.

The vast majority of apples C&C sources in Ireland come from the North.

Incentives from C&C are attracting new growers, while in the UK apple growers are also citing sales of Magners as a reason for improving fortunes.




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