China’s wine consumption growing in tandem with ageing millennials
With more expensive imported premium products and improved margins, industry profits are predicted to grow at 8pc compound annual growth to 200 billion yuan by 2025
As the older generation lives longer, and as people’s health awareness increases, more wine is expected to be consumed in China, according to a new report from Goldman Sachs and Gao Hua Securities.
Current wine consumption is skewed towards younger drinkers, but that market should expand as the millennial population grows older, as has already been seen in developed nations, according to the research led by analysts Liao Xufa and Lincoln Kong.
They predict total consumption volume of grape-based wine, rather than rice wine, in China will increase at a compound annual growth rate of about 6 per cent over the next decade as a result, with the former considered the healthier tipple by among millennials.
The report expects China’s alcohol industry to be worth some 1,300 billion yuan (US$192 billion) by 2025, a 5 per cent compound annual growth from 2016, mainly driven by rising average prices.
And thanks to the move towards more expensive premium products and improved margins, the report suggests wine industry profits to outgrow white spirits, at an 8 per cent compound annual growth to 200 billion yuan by the same year.