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Imported spirits sales in China boosted by younger drinkers
Sales of imported whisky and brandy brands are rising in China due to increased demand from younger consumers, according to reports.
As reported in local press, in the first half of the year, imported spirits sales reached 58.68 million litres, up 10.5% year-on-year, and were worth US$1.15 billion, up 34% year-on-year.
The China Chamber of Commerce of Import & Export of Foodstuffs, Native Produce & Animal By-Products (CFNA) admitted that sales tailed off a bit in 2022, however customs data also showed the value of imported spirits rose by nearly 29% year-on-year in July and by nearly 35% in August.
In terms of categories, brandy and whisky reportedly gained the most among spirits in the first half and imported brandy grew 16% in volume and more than 31% in value. Meanwhile, whisky imports grew almost 8% in volume and more than 18% in value.
Mintel’s senior research analyst Marta Zhang said: “Renewed enthusiasm for social gatherings is expected to drive a surge in on-premise alcohol consumption, revitalising the industry.”
The out-of-home alcoholic drinks market value is expected to reach CNY700 billion (US$95.95 billion) by 2027 with a five-year aggregate growth rate of nearly 11%, according to Mintel’s report Consumption Habits of Alcoholic Drinks China 2023. Additionally, the value of imported spirit products is expected to rebound this year, boosted by the surge in demand for whisky.
Diageo said in its first-half financial report that its business performance in the Chinese market has been strong on the back of whisky sales, despite a decline in sales of its Chinese white spirit products. Similarly, Pernod Ricard revealed in its financial report for 2022-23 (July-June) that its global net sales grew 10% year-on-year to €12.14 billion (US$12.87 billion), with Asia contributing 17%.
Yang Zhengjian, director of WBO Wine Observer, an industry research provider, explained that imported spirits have strong market concentration, reflected by the increasing investment by leading international spirit enterprises in the Chinese market.
Showing an understanding of the growing potential of China, Diageo unveiled its new research and development centre in Shanghai to expand its product innovation and development capabilities in Asia. Also reflecting this, Diageo’s first malt whisky distillery in China, located in Eryuan county, Yunnan province, has been predicted to produce its first China-origin single malt whisky from this year onwards.
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