AGP Executive Report

Restaurant VAT Pressure: A UK campaign (“VATs The Problem”) argues restaurants need VAT relief to avoid more closures, pointing to Germany’s 7% and other EU rates as a benchmark. Non-Alcoholic Beer Boom: The global non-alcoholic beer market is forecast to jump from $25.5bn (2026) to $42.3bn by 2033 as “wellness” and moderation trends drive demand. Beverage Packaging Innovation: Canpack and Florida’s Canovation plan to commercialize resealable aluminum beverage can ends using CanReseal, aiming for pilot-line readiness and broader adoption beyond today’s limited resealable formats. Food Industry M&A Watch: Unilever and McCormick’s proposed $40bn merger is moving ahead despite investor unease, with executives pitching faster growth across food and beverage channels. German Beer/Brand Tie-In: Atwater Brewery’s former owner Mark Rieth has agreed to reacquire the Detroit craft brewer, known for German-inspired lagers and ales—an ownership shift that could refocus local brand ties. Hospitality & Travel Context: World Cup-related travel and fan culture continues to boost food and drink demand around host cities, with Toronto highlighted for its dense restaurant scene and match-day atmosphere.

Restaurant Openings: Arlington Grille, an upscale-but-approachable American grill concept from Rick Doody’s Next Cool Restaurant Ventures, is set to open in late 2026 in the former Houlihan’s space at 3150 Tremont Road, with a 240-seat plan and a 56-seat patio. Industry Deal Watch: McCormick and Unilever are “well underway” on their proposed $40bn merger, even as investors remain uneasy about the scale and past mega-merger track record. Food & Drink M&A: Champagne house Maison Pommery & Associés’ shares rose after it entered exclusive talks with Germany’s Henkell International that could make Henkell a majority shareholder. Payments & Retail Tech: Merchants are consolidating payment stacks faster than expected, with fragmentation driving hidden costs in compliance, support and reconciliation—especially in European hospitality and retail. Consumer Culture: Luxembourg and parts of Germany are seeing a new “Eat No Solo” app aimed at reducing loneliness by pairing diners for meals or drinks in public. Hospitality Ops Pressure: Hotel operators face mounting financial strain as costs rise and lease terms bite, with Germany cited in the wider stress trend.

M&A in Nutrition: Nestlé is buying full control of Germany’s “smart food” brand Yfood, after taking a 49% stake in 2023, boosting its Nutrition division and pushing Yfood beyond Europe (Yfood reported ~€150m sales in 2025). Protein & Meal Replacement Push: The wider protein race keeps heating up as major dairy and food groups expand into meal drinks and wellness nutrition, with deals like Danone’s Huel and Lactalis’s Protein Works showing how brands are shifting from “protein counts” to broader nutrition benefits. On-the-Ground Hospitality Tech: A new report forecasts rapid growth in hospitality robots, driven by demand for hotel and restaurant automation for cleaning and food delivery, despite high upfront costs. World Cup Food & Drink Tie-Ins: Coca-Cola’s FIFA World Cup trophy tour in the US underlines how beverage brands are leaning into major sports moments, while chip makers are rolling out World Cup-inspired flavors. Industry Context: A separate survey highlights rising AI adoption and growing quality investment among manufacturers in the US, UK and Germany.

M&A in Nutrition: Nestlé has bought the remaining shares in Germany’s “smart food” brand Yfood, taking full ownership after a 49% stake purchase in 2023—Yfood’s drinks, powders and bars are positioned around complete nutrition rather than diet or weight loss. Food Waste Tech: Berlin startup Freshflow raised €10M Series A to use AI for supermarket inventory and ordering, already used by retailers including Edeka and Carrefour to cut fresh-food waste. RTD Trends: IWSR reports ready-to-drink overtook vodka in global value in 2025, with spirits-based RTDs growing while malt-based variants decline—Germany is noted as having limited malt RTD presence. Probiotic Research: A UCF study is exploring a simple probiotic (Lactobacillus spp.) to treat acid reflux damage and potentially reduce esophageal cancer risk. Hospitality & Culture: Luxembourg chef Léa Linster received Germany’s Federal Cross of Merit, underlining her role as a culinary ambassador. Market Watch: New reports flag growth in chickpea flour, sourdough, and red rice demand tied to clean-label, fermentation and health-led eating.

Plant-Based Manufacturing: Allplants’ owner Matthew Mills has bought Fairoak Foods out of administration, bringing a 6,700 sq ft Surrey factory back in-house to boost production capacity and protect about 60 jobs. Food Ingredients & Health: A new report flags fast growth for sorbitol as a low-calorie, sugar-free sweetener and stabilizer across food, pharma and personal care. Bakery Trends: Another market outlook points to sourdough’s continued rise, driven by clean-label, naturally fermented positioning and even AI-supported production. Specialty Foods: Red rice demand is growing as consumers look for more nutrient-dense, anthocyanin-rich alternatives to polished rice, with use expanding into functional foods and nutraceuticals. German Context: Separately, German police report a Dortmund shooting incident that ended with a suspect surrender; authorities say children were unharmed and motives are under investigation.

New Openings (Germany-linked hospitality): Berlin’s tram derailment left at least 20 people injured, underscoring how quickly city disruptions can hit day-to-day life for restaurants and venues. Food & Drink Business (international but relevant to operators): Slim Chickens keeps expanding with a new drive-thru-only “Fly-Thru” site in Kentucky, a reminder that convenience-first formats are still winning. Travel & Leisure Demand (tourism spend): GetYourGuide says summer 2026 travel is shifting from “farther” to “deeper,” with more searches and bookings for iconic local experiences—good news for Germany’s attractions and food stops. Sustainability in hospitality: Duni Group will supply plastic-free paper beverage cups and composting trials for Sweden’s Vätternrundan, a model German event caterers may watch closely. World Cup culture (food & venues): FIFA World Cup watch-party guides highlight how fan festivals and large-screen venues are driving on-site food and drink demand.

Restaurant & Retail Expansion: Collins Foods has completed the acquisition of eight KFC restaurants in Bavaria, boosting its German footprint by about 50% and adding scale to a key growth region. Dairy & Ingredients: Arla Foods is absorbing Germany’s DMK to form the largest dairy co-op in Europe, aiming for scale and more whey-based ingredient capacity. Food Packaging Sustainability: Duni Group will supply plastic-free paper beverage cups and trial composting solutions at Sweden’s Vätternrundan cycling event, with compostable packaging handled on site. Public Health Regulation: Baden-Württemberg expands anti-smoking rules from June, banning smoking at outdoor swimming pools and tightening limits across playgrounds, transport stops, and indoor smoking rooms. Market Watch (Germany-linked): Berenberg cut its target price on Whitbread/Premier Inn owner, citing an operational reset but warning the new plan depends on ambitious assumptions.

German Policy: Baden-Württemberg has tightened smoking rules from June 1, banning lighting up in more outdoor spots such as children’s playgrounds, outdoor swimming pools, playground-adjacent areas, and public transport stops, while also extending the definition of smoking to include vapes and e-shishas; hotels can no longer offer smoking rooms, though some venues may set up small, separated smoking zones. Food Tech & Ingredients: German startup Formo says its precision-fermented, cow-free casein has received self-affirmed GRAS status in the US, enabling sales to food manufacturers and aiming for a “no questions” FDA letter later this year. Industrial Partnerships: OXEA and Air Liquide renewed their synthesis gas and hydrogen supply contract at Oberhausen’s Ruhrchemie Industrial Park, with Air Liquide investing €20m to modernize a POX unit and cut CO₂ via a connected carbon capture and liquefaction setup. Hospitality/Travel Context: A German city, Tübingen, was highlighted as a “hidden gem” destination for its largely preserved Old Town and punting on the Neckar—good news for food-and-drink tourism demand.

Food Prices Still High: Eurostat data shows EU food and non-alcoholic beverages rose 33.2% from 2016 to 2025, and even when inflation cools, prices don’t fall—just climb more slowly. Cost Drivers: Wage growth across farming, logistics and retail is pushing costs into supermarket shelves, with energy and commodity pressures easing but not reversing the “price mountain.” German Market Angle: The broader European squeeze matters for Germany too, where shoppers feel “lower inflation” but still pay more at checkout. Hospitality & Dining Culture: A separate Italy case highlights how tap-water rules at luxury hotels can spark legal fights—another reminder that guest expectations and pricing practices are colliding across Europe.

Sports & Hospitality Tie-In: Sky Deutschland extended its ATP Tour broadcasting deal until 2033, keeping exclusive live tennis rights in Germany, Austria and Switzerland and preserving public viewing rights for venues like hotels, bars and restaurants via Sky Business. Food Prices Pressure: A new analysis argues grocery bills stay high because lower inflation doesn’t mean prices fall—food price levels remain “baked in” after the biggest shock in a generation. Beer & Retail Trends: A report highlights the growing appeal of canned craft beer, pointing to freshness and UV protection as key reasons consumers are switching. German-Linked Drinks Campaign: Moët & Chandon’s new summer Champagne-on-ice push, featuring Pharrell Williams, includes takeovers in Germany (Hotel Miramar in Sylt) as the brand leans into the “piscine” ritual. Local Dining Spotlight: A German-themed restaurant review spotlights Der Jaeger, praising its German potato salad, schnitzel and spaetzle in an antique-gallery setting.

Potato Pressure in Europe: Belgium’s frozen-fries hub is facing a potato glut, with spot prices collapsing and farmers reporting major losses as weather, tariffs, and energy costs squeeze demand. Reuse Push at Rail Hubs: TOMRA Reuse is installing automated cup return machines at Freiburg Central Station, linking returns to the RECUP system and refunding deposits digitally—part of a broader European drive to scale reuse. Reuse Champions Named: The New European Reuse Alliance has picked its first “Reuse Champions,” including Tübingen mayor Boris Palmer for defending a city-wide takeaway packaging tax. German Food Culture Abroad: A German-run Bavarian bakery, Varia, has opened in Athens, leaning on Germany’s bread tradition to win local attention fast. German Wine History in Focus: A new documentary, “The Last Spy,” highlights Mainz-born wine figure Peter M.F. Sichel, tying German roots to his post-war role in building Blue Nun.

Reuse & Deposit Returns: TOMRA Reuse has installed two automated cup return machines at Freiburg Central Station, integrating returns into the existing RECUP reusable system and refunding deposits to users’ digital payments. Reuse Policy Recognition: The New European Reuse Alliance named its first “Reuse Champions” at the REuse Economy Expo in Paris, including Boris Palmer, mayor of Tübingen, for defending a city-wide tax on single-use takeaway packaging. Dairy Industry Protest: German dairy farmers plan to spray milk across fields in East Frisia on May 31 to protest “devaluation” ahead of World Milk Day on June 1, blaming political decisions and rising costs. Retail Leadership (Germany-linked): Lidl US appointed COO Alan Barry as CEO in July, as the discount grocer continues its push in the US market. Foodservice Tech (Germany-linked): RATIONAL opened a €35m expansion in Wittenheim, France, boosting production capacity for its iVario Pro and adding customer and training space.

Dairy Protest: German dairy groups (BDM and EMB) plan a mass milk-spraying protest in East Frisia on May 31, ahead of World Milk Day, saying rising costs and “political devaluation” leave farms unable to pass on expenses. Food Policy & Hydration: Italy’s Court of Cassation upheld a Dolomites hotel’s refusal to serve free tap water to a guest, reigniting debate across Europe as heatwaves push hydration while rules on free water remain patchy. Gut Health Science: At DGIM 2026 in Wiesbaden, nutrition expert Stephan C. Bischoff said microbiome research still hasn’t fully reached clinical practice and urged a shift toward gut-function focus rather than mimicking specific probiotics. Market Watch: Tomra is installing reverse vending machines at a German train station, signaling continued push for recycling infrastructure. Consumer Trends: Germany’s ice-cream season is booming under heat, with the confectionery industry estimating about 130 scoops per person in 2024.

Sustainability Push in Fast Food: Hesburger is rolling out Huhtamäki’s fibre-based, plastic-free lids for soft drinks and hot drink cups across its European sites, aiming to cut 41,000 kg of plastic annually; the lids are made from renewable, forest-certified natural fibres and are designed to be recyclable at end-of-life. Reusable Cup Tech Expands: Borro says it has raised €1.3m to grow its digital deposit system for reusable cups into the Netherlands, Germany and France, using bank-card-linked deposits and camera-readable codes (no RFID), with pilots already running at Belgian football clubs and planned for Paris’ Parc des Princes. Dairy Ingredient Demand Outlook: A new market update puts global lactose growth on track from US$3.1bn (2026) to US$4.6bn by 2033, driven by pharma use and rising infant formula production. Protein Trend Watch: Ocado Retail reports surging shopper interest in high-protein foods, with cottage cheese sales up sharply and protein searches rising, reflecting wellness and cost-of-living shifts. Packaging Industry Spotlight: Aitken Spence Printing claims a WorldStar 2026 win in Germany for luxury offset packaging excellence, underlining growing global capability in Sri Lanka’s print sector.

Reusable Packaging Push: Tomra Reuse and Recup have installed automated reusable-cup return machines at Freiburg Central Station, refunding deposits to digital payments and aiming to expand reuse beyond cups. Human Trafficking Crackdown: Germany’s cabinet approved reforms that could make customers of exploitative businesses criminally liable, with sectors like construction, slaughterhouses, restaurants and nail salons in scope. Protein Demand Watch: A UK retailer says searches for “high protein” and “high protein granola” surged, with cottage cheese sales up sharply, as younger shoppers chase wellness and “safer” minimally processed options. Airport Tech Trial: Nuremberg Airport tested a mobile AI robot (with edge AI, no cloud) to answer multilingual passenger questions on parking, restaurants and check-in. Low-ABV Wine Trend: A UK consumer piece highlights the hunt for session-style sparkling wine under 11% ABV, noting dealcoholised options can be hit-or-miss. Hospitality & Drinks Events: BCB London’s second edition wrapped with focus on seasonality, sustainability and low/no drinks, while a German-themed World Cup watch-party concept in the US spotlights beer and food tie-ins.

EU Clean Heat Funding: The European Commission picked 65 projects for its first Heat Auction, with about €400m to cut fossil-fuel use in industrial heat. The list includes food and beverage sites, alongside glass, ceramics, paper and chemicals, aiming to deliver 16.3 TWh of decarbonised heat over five years. Foodservice & Consumer Trends: A new survey says diners increasingly want more adults-only dining options, with many preferring child-free areas or bans late at night—showing restaurants are being pushed to rethink seating rules. Coffee Sector Watch: A global roundup highlights standout coffee brands and roasteries, underlining how cafés keep differentiating through concept, funding and international expansion. Hospitality & Legal Precedent: Italy’s Supreme Court ruled hotels don’t have to provide free tap water, after a tourist was denied and sought damages. Health & Weight Loss: Alberta’s Royal Alexandra Hospital is offering endoscopic sleeve gastroplasty, a minimally invasive stomach-stitching procedure covered publicly.