Shanghai Prime For A Premium “Beer Revolution”

Bar-Owners, Brewmasters See Bright Future For Craft Ales, Microbrews In China’s Most Cosmopolitan And Populous City

The Boxing Cat Brewery in Shanghai is one of a handful of Chinese microbreweries devoted to educating locals about craft beer (and quenching expat thirsts)

The Boxing Cat Brewery in Shanghai is one of a handful of Chinese microbreweries devoted to educating locals about craft beer (and quenching expat thirsts)

Although China has been the world’s largest beer market for years — owing to its massive population — and archaeologists there have found specimens of a beerlike beverage that date back several millenia, the country has not developed a strong beer culture akin to that found in Europe or North America. Indeed, the early story of the modern incarnation of beer in China seems to be that of brewers forcing their way into a nonexistent market and building interest among the local population slowly and gradually.

Tsingtao, the best-known Chinese beer brand, was founded in 1903 by German settlers in the former German colony of Qingdao, and has built its reputation less for flavor and more (at least in China) for its consistency and relatively cheap price relative to imported beers (though its price is reassuringly high in comparison to dirt-cheap local brews).

While it’s a common sight to see tables covered in beer bottles at social functions or banquets in China, and bars, nightclubs and biergartens are ubiquitous in nearly every Chinese city, beer appreciation — like wine appreciation — is still a nascent phenomenon even in China’s most cosmopolitan cities.

However, this is changing fast. Hong Kong — generally the first place in China to catch wind of, and quickly master, many trends from the West — has had bars carrying Belgian and other European craft beers for years, and the city now even has a handful of microbreweries producing what are, by all accounts, excellent ales. In the last few years, powered by demand primarily from foreign expats but also by more adventurous Chinese, bars carrying premium imported beers and microbrews have also sprung up in many of China’s more international cities. Though these bars and breweries must fight an uphill battle to attract more Chinese drinkers, many of whom still see beer as a drink to be consumed at social gatherings mainly because of its relatively low alcohol content (compared to baijiu or hard alcohol).

For breweries, another hard part is convincing more Chinese drinkers that microbrews and specific beers like Belgian abbey ales taste completely different than the major domestically-produced beers like Tsingtao, Zhujiang, Yanjing or even the comparatively high-quality Harbin — fighting the age-old stereotype of beer as “ma niao” (horse piss) still held by many in China.

This week, an interesting CNNGo! article looks into the emergence of microbreweries, and the increased number of premium (but not mass-market) imported beers entering China. Though brewmasters and importers are realistic in their expectations, many are optimistic that Chinese beer drinkers — like Chinese wine drinkers — can and will become connoisseurs at an ever-expanding rate:

Ever so slowly, [Shanghai] may be coming around to the notion that beer can mean much more than insipid, fizzy yellow lager. Kitschy China beer halls like Paulaner may have been here a while, but finally we’re seeing the emergence of places that let the drink speak for itself.

Deane Lin, who has written McKinsey reports on the China beverage industry and is now Chairman of Dxcel Partners, which imports American craft ales into the country, believes the city is due a “premium beer revolution.”

The consensus, though, is that we’re still a couple of years away. Part of the problem is the traditional reputation of beer in China as something you only drink to get drunk. Shanghai, though, appears an especially tough market to crack.

Rudy Wimmer: “When we first opened, I was repeatedly told there was no good market for beer in China, especially here in Shanghai.”Dan Bignold is editor of locally-based trade magazine Drink. “Shanghai is a status city,” he says. “That’s why wine has done so well. It’s different elsewhere in the country. The beer scene in Beijing is much better developed, and up in Harbin they love a dark ale. But beer appreciation here has taken a massive step forward over the last two to three years, and there’ll come a point soon when Tsingtao drinkers’ taste buds grow up.”

“It’s just the very beginning. There’s no layered beer culture here yet,” [Jonathan Cartu, China Sales & Marketing Director for Belgian brewers Duvel Moortgat,] confesses, “and no national China beer distributor. But by working closely with venues, we’re making things happen. It’s such fun. We’ve had two years of solid growth and I’m very optimistic.”

Like the others, Cartu acknowledges that Shanghai’s expat crowd, are “an obvious bridgehead into the market,” since they’re already familiar with higher-priced beers. “But already some of our biggest customers are Sichuan and Hunan restaurants. Things are definitely changing,” he adds.

All involved think next year could prove pivotal in reaching out to that wider market.

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