Bottoms Up: China’s Alcohol Imports Jump 58 Percent

Country’s Alcohol Imports Increased To US$2.4 Billion Last Year

Johnnie Walker House, Shanghai

If there’s one area of the Chinese market that has continued to do incredibly well regardless of all others, it’s high-end imported spirits. With thirst growing throughout the country for cognac, whisky, wine and even craft beer, and an estimated 20 million new drinkers coming of age every year in China, some major producers have defied fears of a significant slowdown in Chinese demand. However, according to new figures, 2011 may be a hard act to follow. As Chinese Vice-Minister of Commerce Jiang Zengwei said this week at an alcoholic beverage expo in Guizhou province, alcohol imports jumped a massive 58.1 percent over the course of 2011 to US$2.4 billion, with China importing 500,000 kiloliters of alcohol.

Interestingly, the international ambitions of China’s wine and spirits manufacturers seem to have made some progress as well, with China exporting US$500,000 worth of their products in 2011, a 51.3 percent increase year-over-year.

According to attendees at the recent Worshipful Company of Distillers debate in London, the fundamentals of China’s wine and spirits industry are cause for serious optimism: 1.1 billion people of legal drinking age, a middle class that should number 430 million by 2015, and US$656.1 million worth of spirits imported last year — a number expected to double by 2015, according to Morgan Stanley.

Whether imports this year will beat 2011 is difficult to predict, but recent figures from major spirits producers indicate that they’ll be close, at least. Continuing its winning streak in the Greater China market, led by the region’s seemingly insatiable demand for high-end cognac, the French spirits group Remy Cointreau beat forecasts in the first quarter of this year, rising 24.4 percent, driven by cognac demand in Asia and the United States. Making up 62 percent of Remy Cointreau’s cognac sales, Asia remains the company’s top-selling region by far, with China in particular responding well to intensive marketing efforts by the group for its US$2,500 Louis XIII cognac. Also this year, Pernod Ricard said that its Martell cognac brand was growing strong, thanks to Chinese demand. Martell sales grew 28 percent over the last six months of 2011, compared with the year-earlier period, making it one of the company’s fastest-growing brands.


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