As China continues to keep the coronavirus in check, its economy is showing increasing signs of recovery, and with that, the normalisation of everyday life, including socialising over an alcoholic drink or two.
As social distancing rules and dining out restrictions are eased, brewers and distillers report increased demand, and the Chinese consumer, it seems, has a thirst in particular for premium brands, reports Nikkei Asia.
The country’s largest brewer by volume, China Resources Beer Holdings, said it had seen strong sales of its premium Heineken label beer, with the president of the company’s Guangdong operations, Song Zhanmin, describing sales growth in the July to September quarter as in the “high double digits”.
The domestic market’s second-largest brewer, Tsingtao Brewery, said sales were up 4.8% in Q3 year-on-year, following a fall of 5.3% in the first half of the year. And the third-largest brewer, Beijing Yanjing Brewery, saw a pick-up of 10% compared to the same period in 2019, and after a plunge of 13.9% in the first half of the year.
Jan Craps, co-chair and CEO of Budweiser Brewing Co. APAC, said last month that the brand was seeing “a continued trend of premiumisation, especially in China”. The label’s owner, Anheuser-Busch, reported 4.8% year-on-year growth in China in the third quarter, after a dramatic decline of more than 23% in the first half of the year.
More than 90% of Budweiser’s sales at traditional night life venues had returned in China, Craps said.
Carlsberg subsidiary Chongqing Brewery also saw a sharp rise in sales in the third quarter, led by its premium labels.
Makers of the traditional high-end Chinese spirit baijiu also saw a lift in sales in the third quarter as a result of a loosening of restrictions, although the pick-up was less dramatic than beer sales, Nikkei Asia reports.
Chinese consumers’ growing penchant for premium products is seen by Beijing as a key driver of the country’s economic recovery, says the news magazine.
"The growth of consumption upgrade items kept a high pace," it quotes a spokesperson as saying last month as the country announced GDP growth of 4.9% during the third quarter. The spokesperson specifically singled out “tobacco and alcohol” in this context. Government figures show that overall sales of tobacco and alcohol shot up by 17.6% year-on-year in September, following a decline of 1.3% in the first eight months of the year.
Sourced from Nikkei Asia