2021 is also regarded as the "first year" of China's whisky consumption market. After a long period of market cultivation, whisky began to break out in the Chinese market last year, with a significant increase in import data. Two international liquor giants, Pernod Ricard and Diageo, also invested and built their first whisky factory in China.
In contrast, the road to internationalization of Baijiu seems to have never found the key point of breaking the board. Recently, the number of liquor companies receiving UNESCO showed that the international market's awareness of Baijiu was only 0.7%. But the massive invasion of whisky touched the nerves of Baijiu enterprises.
the first year of whisky
In Wudaokou, Beijing, whisky bars that used to be a minority are becoming more and more common. Although most of these whisky bars still focus on "whisky + cocktail" products in order to give consideration to business, whisky has begun to dominate the wine list. Dozens of whisky products are often placed on the wine cabinet on the whole wall of the bar, Consumers can taste 3-5 whisky products at a cost ranging from 150 yuan to 300 yuan.
Tianjin wine merchant Wang Sheng told the first financial reporter that the whisky business is getting hot in the past two years. When visiting customers, he saw that in the past, most of the customers who went to the store were middle-aged male regular customers, and now there are many young new faces.
The popularity of whisky business is more clear from the import data in 2021. According to the statistical analysis of alcohol imports from January to September 2021 released by the alcohol importers and exporters branch of China Chamber of Commerce for import and export of food, soil and livestock (hereinafter referred to as the alcohol importers and exporters branch), the import volume of spirits exceeded billion liters from January to September 2021, reaching US $1.64 billion, an increase of 42.3% and 88.9% respectively year-on-year. Among them, the import amount of whisky reached US $310 million, a year-on-year increase of 113.4%, and the import volume was 22.13 million liters, a year-on-year increase of 55.8%.
The growth of import data has also driven the performance of international wine giants.
According to the results of fiscal year 2021 released in early September 2021, the revenue of Pernod Ricard reached 8.82 billion euros, a year-on-year increase of 9.7%. Driven by liquor products including whisky, the revenue of the Chinese market reached 1 billion euros, a year-on-year increase of 44%, also reaching a record high.
Zheng Zhili, vice president of Asia Marketing Department of Baole Ricard, told the first financial reporter that in the past five years, the growth of malt whisky in China has exceeded 30%. With the expansion of middle-income groups, especially the growth of young consumer groups, whisky consumption has gradually shifted from night to home consumption, which has also brought great market opportunities.
In the view of the industry, the outbreak of whisky in China is due to the rise of the younger generation of consumer groups. Its diversified and personalized drinking demand has driven the growth of foreign wine categories represented by whisky, and is also inseparable from the popularization and market education of whisky in China.
"The current market performance of whisky in China is just like the imported wine from 2008 to 2009." Yang Zhengjian, President of wbo wine business school, told the first financial reporter that at present, China's whisky consumer market is expanding rapidly, gradually expanding from the first-line market to the second and third-line market, and Chinese whisky manufacturers are also beginning to emerge.
In November 2021, Pernod Ricard announced that its first whisky factory invested and built in China was officially put into operation, and announced a long-term plan with a total investment of 1 billion yuan over a decade. In the same period, Diageo also announced a plan to invest 500 million yuan to build China's first whisky factory in Dali, Yunnan Province.
Yang Zhengjian told the first financial reporter that at present, not only overseas giants are laying out the Chinese whisky market, but also about 20 whisky factories are under construction or have been built in China. The whisky category will have a more obvious growth curve in the Chinese market in the next 3-5 years.
Baijiu liquor internationalization
Whisky's rapid expansion in China has also attracted the attention of Baijiu liquor enterprises.
Chinese Baijiu and Baijiu, whisky, vodka, rum and gin are called the six largest distilled spirits in the world. Guotai Junan Securities Co.Ltd(601211) research shows that whisky and liquor are the two largest spirits in liquor. Whisky contributes 24% of global spirits sales (about 660 billion RMB / year), while the corresponding share of Chinese Baijiu is 22% (about 600 billion RMB / year).
Over the past few years, the top liquor companies including Moutai, Wuliangye Yibin Co.Ltd(000858) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) and Luzhou Laojiao Co.Ltd(000568) have been targeted to international investment, including developing international distributors, sponsoring major overseas events and cultural activities, and exporting overseas culture and brand, accelerating the promotion of overseas sales of Baijiu. The Baijiu Baijiu export volume fell to 460 million US dollars in 2020, and the export volume of liquor in 2019 was US $670 million. The export volume of Baijiu liquor is indeed increasing year by year before 2019.
China China Baijiu Baijiu, which has been released by the Chinese Liquor Association, has reported that the output of Chinese Baijiu in 2020 is 740.73 million liters, the export volume of Chinese liquor is 1.4 million liters, and the volume of liquor exports accounts for only 0.19% of China's output. In the global liquor consumption market booming, the consumption of Chinese white wine is nearly 1/3 of that of the world's spirits, but the proportion of the world's market share is less than 8%. It also shows that the internationalization of Chinese Baijiu is slow, not very deep, and the effect is not good.
Compared with whisky, the market has opened up in China, and the international market expansion of Baijiu has not really broken.
"Whisky into China and Baijiu liquor to the international market is close to the situation, but the results are not the same." Zhang Weidong, general manager of Shanxi Xinghuacun Fenjiu International Trade Co., Ltd. (hereinafter referred to as "Fen China World Trade Center"), has been responsible for the international business of Fenjiu. The first financial reporter has been told that Baijiu products have been sold overseas, but they haven\'t broken through the Chinese consumption circle. The foreign consumers have limited knowledge of Baijiu.
China's famous Baijiu products are sold in Chinese and American supermarkets in Europe and America, but the buyers are mainly local Chinese, and a large proportion of Baijiu, which is exported for cooking purposes, is not really consumed, Zhang Weidong said.
It is worth noting that a portion of high-end Baijiu is reexported to the domestic market after being exported.
In 2021, 1-9 months of liquor import data can be seen in some statistics. In the import liquor statistics, Baijiu ranked 89 million 673 thousand in the import list, up 15.4% from the same period, and the import volume was 2 million 440 thousand litres, up 31.6% over the same period last year.
However, from the point of view of import sources, the import volume of spirits imported from China in the Baijiu data is 61 million 125 thousand US dollars, and the import volume is 382 thousand litres, which accounts for a very high proportion. The average import price is about 160.1 USD / liter, about 1019 yuan / liter, and the average price of imported strong liquor in France is 31.1 USD / liter for the same period.
New thinking on Baijiu internationalization
In the industry, the internationalization of Baijiu is slower, both internal and external.
Zhang Weidong told the first financial reporter that the difficulties in Baijiu internationalization include two aspects. On the one hand, Baijiu has achieved overseas sales, but the whole system lacks the international standard system. On the other hand, Baijiu has not yet set up an international wine evaluation system, which is not conducive to building up consumer cognition in the process of internationalization.
"For example, the European and American wine tasting system is very intuitive, such as the European and American wine tasting men who believe that the aroma of blue and white Fen Wine contains pineapple, apple, caramel and other aroma, but Baijiu's evaluation and expression system is more implicit, and the two are not the same." Zhang Weidong said that Baijiu has its own unique characteristics and advantages in the fermentation of raw materials and fermentation methods, but the difference in the evaluation system makes it difficult for overseas consumers to quickly remember and understand the aroma and characteristics of Baijiu.
Since Baijiu is divided into various flavors such as thick, clear and sauce, it is more complex than whisky and brandy on the product, which makes it difficult for foreign consumers to distinguish. In recent years, the value system of Baijiu products is also chaotic. There are many concepts such as production area and year, but there is no uniform standard, which also hinders consumer cognition.
Yang Zhengjian told the first financial reporter that in addition to the standard wine evaluation system, whisky products also have strict regulations on the production area and wine body year through legislation. The classification is clear and easy for consumers to identify. In addition, there are professional third-party evaluation institutions in the industry, which can assist consumers in recognizing and selecting products, In this respect, there is still a big gap in Chinese Baijiu products. For example, the law stipulates that the year marked on whisky and brandy must be the real year, while China has no relevant laws and regulations.
In addition, Baijiu analyst Cai Xuefei told the first financial reporter that China's economic rise is relatively late, and the advantages of cultural exports are not obvious at present, so internationalization is advancing slowly. In addition, over the past few years, the Chinese Baijiu market has been concentrated in famous liquor enterprises. The famous liquor enterprises have been growing well in China and lack of enthusiasm for export. Besides, the epidemic also has great influence on the internationalization of Baijiu.
However, China Baijiu market has gradually slowed down as the Chinese liquor industry adjustment has entered the second half. Under the new pattern of "double cycle", the new opportunity of Chinese Baijiu internationalization is emerging.
English customs English Baijiu Baijiu was agreed to change the English name of liquor in the 2021 import and export tariff code of People's Republic of China in January 2021. Changing its corresponding English name to "Chinese Baijiu" has not only solved the problem that liquor has been lacking official official English name, but also helped the spread of Chinese liquor internationalization. In March 1st, the agreement between the People's Republic of China government and the European Union on the protection and cooperation of geographical indications came into force. 11 geographical indications of China, including Moutai and Wuliangye Yibin Co.Ltd(000858) , were incorporated into the EU's protection area, which helped Baijiu enterprises to open up international markets.
Although China's Baijiu enterprises are the largest source of the total income, Cai Xuefei told the first financial reporter that the development of whisky can be seen as a part of cultural output. With the growth of China's global influence, a considerable increment of Baijiu head enterprises will come from the expansion of the international market.
China's Scotch Whisky China exported Chinese Baijiu in 2019, which was 40 billion yuan, while the export volume of Baijiu was only 4 billion yuan in 2019. However, the proportion of total exports of Guotai Junan Securities Co.Ltd(601211) and China's exports in the same period was 16.3% and 12.4%, much higher than that in the same period in the UK, which is 3.2% and 2.4%. There is room for imagination in Baijiu.
China's market performance of whisky in recent two years has also touched the Baijiu enterprise and the strategy of internationalization is also adjusting.
During the NPC and CPPCC Chinese Baijiu in 2021, Li Shuguang, chairman of the NPC and Wuliangye Yibin Co.Ltd(000858) , suggested that the relevant departments should increase support for Baijiu's export trade, cultural promotion, special treaties and overseas development, and further promote the internationalization of Chinese liquor.
At the fourth China International Import fair, Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) and Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) launched their Baijiu heart chocolate with international liquor giant chocolate giant Berg, hoping to bring Baijiu to more foreign consumers. At the same time, Baole Liga also confirmed to China first finance that it had established cooperation with Wuliangye Yibin Co.Ltd(000858) in distribution in Southeast Asia, but did not disclose the specific cooperation content.
Zhang Weidong told the first financial reporter that Baijiu enterprises are also studying the way of whisky playing in China, which has been doing long-term consumer education in the China market. The training courses have been done by professionals, such as bar workers, dealers and enthusiasts. It also drives China's whisky collection market. Through 20 years of efforts, whisky has gained a firm foothold in China's night channel and is expanding to the catering market in the next step.
It is reported that in the next step, Fenjiu international also plans to build a new international marketing system, in which cultivating consumers will become one of the key tasks. In 2022, Fenjiu will build 13 overseas experience pavilions on the basis of three experience pavilions in Germany, Singapore and Thailand; And organize opinion leaders and wine critics through local dealers to carry out local consumer education.
China's Chinese Baijiu will not be able to see the effect immediately, but Zhang Weidong thinks that the process of liquor internationalization will be very long. It is necessary to start from "foreigners in China" and then develop into "Chinese in other countries", so that foreigners can finally achieve "Baijiu" drinking. Baijiu China will remain one of the key directions of China's liquor internationalization. Because in previous surveys, consumers in Southeast Asia love to watch Chinese entertainment programs in recent years, and their understanding of Chinese culture is deepening, and they also have the basis of market development.
First financial reporter understands that at present, there are more than 600 million people in Southeast Asia and a relatively large number of Chinese. For Chinese Baijiu enterprises, it is also an incremental market that can not be ignored.
Baijiu Baijiu Baijiu collocation also suggested that in the short term, the liquor standards could not be integrated with the international standards. It is not difficult to simply do consumer education. The new international liquor can be used as a reference for Japanese sake. The latter can be imported into the international market quickly through the daily market. The liquor companies can also consider how to match the Chinese food with Yang Zhengjian, so as to speed up the sea going.
(source: First Finance)
