This new report from Access Asia covers the market for alcoholic spirits in China. Despite the slump in spirits sales in the rest of Asia following the recession, China’s market has continue to grow, as has consumer spending power and sophistication.
Alcoholic sprits remain part of Chinese tradition appearing in many social activities including birthday party, weddings and other ceremonies as well as business entertainment. Traditionally spirits are the main drink denoting happiness or respect. China produces distilled spirits for the local market in great quantities. The most famous Chinese spirit is Maotai, a 55% spirit made of wheat and sorghum that, for centuries, has been produced in Maotai Town, Guizhou province. The Chinese spirits market is both large, and (relative to other developed markets) still growing rapidly. Add to this the fact that Chinese consumers are very sophisticated, and highly brand conscious, and that the degree of sophistication is ever increasing as more brands and products are introduced. The market is also competitive with 38,000 traditional Chinese spirit producers competing in the market. Having been protected from the economic crisis seen in much of Asia, due to the non-convertibility of its currency, the Chinese consumer economy has remained buoyant, and consumer spending continues to grow. Older people (the majority spirit drinkers in China) are drinking less traditional spirits, replacing these with beer, due to the lower alcohol levels in beer, thus reducing the health risks associated with drinking of traditional spirits. Overall per capita consumption is still comparatively low in China, which offers a large scope for market development.