Home / World Business
Mon, Feb 28, 2005 - Page 12 News List

China boosts global whisky market, but stocks could run out


This file picture shows a selection of the many varieties of malt whisky produced in Scotland. Whisky sales in China are rapidly increasing and Scotch exports to the country rose by 137 percent in the first 10 months of last year.


Good whisky brands typically take 21 years to mature, and almost the same period of time has been needed for the China market to become ripe for Scotland's most famous contribution to world culture.

Visit any trendy bar or karaoke club in Beijing, and chances are you will see a group of 30-somethings, men and women, gathered around a bottle of Scotch.

The ever-more hectic nightlife of China's big cities accounts for huge leaps in sales, according to Geoffrey Kau, a manager at Riche Monde (China) Ltd, which distributes the Johnnie Walker brand in the mainland.

"People mix it with green tea, and they can easily finish a bottle within an hour," he said, sitting next to three cases of freshly-imported Black Label.

One-bottle-an-hour karaoke visitors were a main factor helping Riche Monde to double whisky sales in Beijing to 14,000 cases last year, he said.

Chinese markets also helped boost the global sales volume of Chivas Regal by 12 percent last year, according to the owner of the brand, French wine and spirits giant Pernod Ricard.

"Chivas Regal reported increased sales for all regions, with a spectacular acceleration in Chinese Asia," Pernod Ricard said in a statement earlier this month.

Industry-wide, market analyst Datamonitor estimates China sales last year increased at least 20 percent, possibly twice as much, from 294 million yuan (US$35 million) in 2003.

With growth rates like these, the world's whisky producers feel compelled to pay increasing attention to the Chinese market, even though genuine connoisseurship is infrequent even among sophisticated urbanites.

"They don't really know the taste," Kau said. "They just follow the trend and know it's a popular product to drink."

The lack of Chinese interest in the culture and history of whisky is confirmed by tastings of Irish, Scotch and Bourbon organized by Beijing's John Bull Pub.

"Each time, the people who turn up are 95 percent foreigners, and just one or two Chinese," said Frank Siegel, the pub's owner.

The imported drink of choice for China's nouveaux riches remains cognac, but in the long term it may face a disadvantage, as it is not linked to the youthfulness and energy conjured up by whisky, according to analysts.

"Cognac in China is associated with very old men drinking it in oak-paneled rooms," said John Band, a researcher with Datamonitor, who recently completed a study on China's whisky market.

Retailers in the Chinese capital also recognized the youngish profile of people who drink whisky.

"Locals used to stick to vodka, but we see more of them coming to buy whisky," said Lu Wuji, a manager at Jenny Lou's Shop, a popular retail outlet in Beijing. "They are mostly well-off and in their 30s or 40s."

China is likely to eventually become a much bigger market for imported brands than the other Asian giant, India.

This is because most whisky in the subcontinent is indigenously produced, possibly because of influence from the colonial era.

If China's huge potential were to be fully developed one day, the world's whisky reserves would simply be depleted.

"For China to reach the level of Scotch whisky consumption per head seen in Hong Kong and Taiwan, they would need to buy far more Scotch than can conceivably be produced," Datamonitor's Band said.

All the major distillers should be looking at China, even if they may have to wait for a quarter century to see the market boom in a big way, observers said.

This story has been viewed 7197 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top