American whiskey eyes China as important growth market
With its increasingly urbanized population and rising high-income group, China is a major growth market for American whiskey, a US industry leader said.
“We’ve seen growth in China and our exports are up almost 15 percent compared to 2016,” Christine LoCascio, senior vice-president of international affairs at the Distilled Spirits Council of the United States, said in a recent interview.
“It’s a growth market for us. It ranks as our 24th largest export market, but there are still a lot of opportunities to grow and we’ve been doing promotions there,” LoCascio said on the sidelines of the national trade association’s annual economic briefing in New York City.
“China is a huge spirits market, and we just see it quite an opportunity for us,” she said.
Since March 2017, DISCUS has appointed a Beijing-based American whiskey ambassador to provide in-market media relations and general trade servicing, promotions and educational outreach to bars, clubs, restaurants and influential trade contracts in Beijing, Shanghai and Guangzhou.
“We are optimistic that we will continue to grow. China is a relatively open market, and the import tariff is only 10 percent. So compared to some other markets throughout Asia, it’s a very open market,” LoCascio said.
“We just continue to view it as an opportunity for growth for us. We are going to continue our education campaign; we look forward to continuing to expand our exports there,” she added.
Kraig R. Naasz, DISCUS president and CEO, said the industry’s strategy in China is predominantly focused on the long term as the market holds great promise and the markets for premium US spirits are still developing.
“American whisky has a rich history and tradition behind it. It’s very flavorful and can be mixed in many ways until you find the perfect cocktail for you,” Naasz said when asked what makes American whiskey stands out among the world’s spirits.
“I have tried many Chinese spirits as well as delicacies that are provided throughout China, and find them much delightful,” said Naasz, who has visited China on several occasions in recent years. “I look forward to coming back because every time I visit, the change is amazing.”
“On behalf of all American whiskey producers, we wish our Chinese consumers a very joyous New Year celebration and we like them to enjoy our products in good health, and good fortune, cheers to Chinese!” Naasz said.
Buoyed by a weak dollar, overseas sales of US-made spirits were up more than 14 percent, reaching $1.63 billion last year, according to DISCUS. The United Kingdom, Germany, Brazil, France and Spain were the largest export markets for American spirits in 2017.
Ryan Christianson, owner of Xanthos Wines, a winery in Napa Valley, California, agreed that the biggest driving factor of American whiskey recently is the favorable exchange rate, which makes US whiskey compete better in the market, as traditionally the US imports have been uncompetitive due to the dollar’s strength.
“Whiskey is becoming more and more popular in the Chinese market. Our winery is involved in a whiskey project and we will have an American whiskey on the market in 2019 or 2020,” he said.
“Right now, the leaders in the Chinese market are Japanese whiskey and then Scotch and to a lesser extent Irish whiskey,” Christianson said.
“American whiskey has several industry leaders that have done very well in the Chinese mainland, such as Jack Daniels. US premium brands are gaining popularity in China, driven by Chinese consumers’ preference for high-quality products,” he added.