by The Baijiu Market is estimated to be valued at US$ 900.24 Mn in 2022 and is expected to exhibit a CAGR of 4% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Baijiu is a clear distilled alcoholic beverage native to China. It is derived from grain and tends to be bitter in taste, typically between 40% to 60% alcohol by volume. Baijiu is typically consumed during meals and social gatherings and is considered an essential part of Chinese cuisine. The most commonly used grains for producing baijiu include sorghum, sweet potato, and rice. The grains are fermented and distilled to produce the spirit. Baijiu comes in various styles defined by the region, such as Guizhou baijiu, Shaoxing baijiu, Maotai baijiu etc.
Market Dynamics:
Rapid urbanization in China has positively impacted the sales of baijiu over the recent years. As people migrate to urban centers, they tend to adopt urban lifestyles and preferences. This includes socializing over drinks including baijiu during meals and other gatherings.
Additionally, rising disposable incomes in China have enabled consumers to spend more on alcoholic beverages like baijiu. However, increasing health awareness among Chinese consumers may hinder the market growth as many switching to low-calorie beverages.
Nevertheless, domestic producers are focusing on premiumization of baijiu by introducing high-quality and well-aged variants to attract health-conscious consumers. Furthermore, Chinese government support through various trade deals has boosted Chinese baijiu exports which is estimated to provide new avenues
Segment Analysis
The global Baijiu market is dominated by the rice baijiu segment owing to the traditional popularity of rice-based spirits in China. Rice baijiu accounts for over 60% of the overall market share as it is considered premium and is consumed during social and business events. The millet baijiu segment is expected to witness emerging demand in the coming years due to increasing popularity among health-conscious consumers.
PEST Analysis
Political: The Chinese government supports the local Baijiu industry through subsidies and trade policies promoting domestic production. However, stringent regulations around alcohol advertising and marketing may constrain market growth.
Economic: Rising disposable incomes and improvement in living standards in China have boosted overall alcohol consumption. Growth in online sales channels is also expanding the market reach.
Social: Baijiu forms an important part of Chinese culture and is commonly served during social occasions, festivals, and business meetings. Changing social trends targeting health and wellness may impact consumption patterns.
Technological: Players are investing in innovative packaging solutions and developing new flavors to expand their appeal beyond traditional consumers. Advanced production techniques are helping improve quality and consistency.
Key Takeaways
The global Baijiu Market is expected to witness high growth, exhibiting CAGR of 4% over the forecast period, due to increasing social consumption and popularity of premium varieties. The Chinese market accounts for over 90% of global demand currently dominated by Guangdong, Shandong, Henan and Jiangsu provinces.
Regional analysis: The Chinese market is the largest contributor to global Baijiu sales currently dominated by Guangdong, Shandong, Henan and Jiangsu provinces where rice cultivation is widespread and consumption traditions are deep-rooted. Emerging markets such as Southeast Asia and North America are expected to offer lucrative opportunities owing to increasing Chinese diaspora and expat populations.
Key players operating in the Baijiu market are Kweichow Moutai, Wuliangye, Yanghe Brewery, Daohuaxiang, Luzhou Laojiao. Kweichow Moutai has been the dominant market leader due to its premium positioning and brand cachet in the rice baijiu category. Wuliangye has steadily expanded its market share with investments in international marketing and e-commerce channels.
*Note:
- Source: Coherent Market Insights, Public sources, Desk research
- We have leveraged AI tools to mine information and compile it
