Indeed, China’s consumption was up 5% on 2011 in spite of its economic slowdown. According to Euromonitor, spirits will provide the next boom segment, with 2012’s volume of hard liquor rising to 5m litres and predictions that the market will increase 16% year on year until 2016—although this amounts to a fall compared to 2006-2011, which saw compound growth at 21%.
Japan behind
It shows China’s complete dominance of the Asia-Pacific alcohol market when India, the most comparable nation in terms of population, took third place in the region with consumption of 4.4bn litres—almost 55bn litres behind.
In between the two Bric heavyweights stood Japan, with a 8.9bn litres consumed. The country, in turn, sealed sixth position globally, although its consumption last year remained relatively stagnant compared to 2011 levels.
While China and Japan’s liquor markets were based largely on beer—at 84% and 70% respectively—India’s consumption of beer and spirits was at close to parity, with 2bn litres of the former and 2.4bn litres of the latter consumed last year. Whisky, as usual, was India’s favourite spirits category, accounting for over half of all hard liquor sales in the country.
“While profits are relative low [in India] compared to international spirits, they offer a fantastic platform for when international spirits products, especially blended Scotch, become more affordable to Indian consumers,” wrote Euromonitor’s senior alcoholic drinks analyst, Jeremy Cunnington, in a blog post.
Takeover talk
This paves the way for a potential majority acquisition of United Spirits, India’s top-selling liquor company, by Diageo, which was agreed in November but has been slowed down by regulatory approvals. The appointment this week of an Indian-born CEO with experience in the subcontinent, Ivan Menezes, might help restart the process, but this is yet to be seen.
In fourth place, Korea’s market accounted for 3.7bn litres, an increase of 2% over 2011. However trends are changing there, with the Scotch market declining to the benefit of beer and vodka.
Behind Korea, Vietnam’s young and increasingly upwardly mobile population brought strong growth of 11% to 3bn litres, with a surge both beer and spirits contributing to the rise.Thailand, in sixth place, and the Philippines behind it, saw marginal rates of growth.