Vietnam looks to low alcohol beer for growth as government ban looms

Vietnam is exploring the low and no-alcohol beer categories for growth potential as the government intends to ban sales of higher strength drinks after 10pm.

The country’s Saigon binh Tay Beer (Sabibeco), an affiliate of the country’s biggest brewery Sabeco, is planning to quintuple the production of its ‘Sagota’ brand of low-alcohol beer to 1 billion litres by 2025, Nikkei reported.

The beer, with less than 0.5% alcohol content, was first launched in 2014 but did not catch on upon its release. Interest however has recently started to build among women and younger beer drinkers.

In addition to domestic production, imports of non-alcoholic and low alcohol beer are also increasing, mainly from Germany and Japan.

German brand Oettinger’s alcohol-free beer, Japan’s Asahi Breweries’ Dry Zero and Russia’s Baltika are available in Vietnam’s supermarkets and online retail space.

The trend in Vietnam also coincided with a time when the government is mulling whether to pass a bill that would ban the sales of alcoholic beverages above 15% ABV after 10pm, which could give a further boost to the ‘low and no’ drinks sector.

The new bill proposed by the country’s Heath Ministry is to be reviewed by parliament next year.

Vietnam produced 3.78 billion litres of beer in 2016, up from 9.3% in 2015 and from 40.7% in 2010. Its per capita beer consumption is about 42 litres, behind South Korea and Japan, based on a 2014 report by Kirin.

Globally, other producers are also cashing in on the low alcohol drinks trend. Japan’s Suntory recently launched a clear, non-alcoholic ‘beer’ and American brewery Lagunitas unveiled a non-alcoholic, hop-based water.

Alcohol-free beers are seeing a strong boost in the UK as well, with sales up by 58% year-on-year.