Several toasts into a long dinner for visiting reporters, an official in the old steel town of Benxi is inspired to share a traditional saying from northeastern China: 'If you have liquor without food, it can be bad for your health. But if you have food without liquor, then you don't have any liquor.' Banish the thought. Alcohol in various forms has been part of the Chinese lifestyle and culture for millennia. The national tipple is baijiu, a throat-scorching liquor usually distilled from sorghum. In 2006, retail sales of baijiu rose 34 per cent to 97.13 billion yuan (HK$110.94 billion) - roughly 75 yuan for every man, woman and child on the mainland. Northeasterners enjoy a reputation for being especially fond of their booze. Most banquets begin and end with toasts. It is not uncommon to find the dining table set with three glasses - one each for wine, beer and baijiu. But while demand for baijiu across the mainland remains healthy and growing, the industry itself has been going through a consolidation phase. The majority of the market is cornered by a few national players based in southwestern provinces, such as Kweichow Moutai and Wuliangye Group. But despite this dominance of the big players, 30,000 smaller local and regional distilleries persevere. In the northeast most towns still have at least one producer. In Shenyang , the provincial capital of Liaoning , the local brew is Laolongkou, or 'Old Dragon's Mouth'. The distillery's name comes not from the taste of its product, which has a smooth flavour, less malty than the popular baijiu from the southwest. Instead, it refers to the plant's location. Back in 1662 a businessman from Shanxi province arrived in Shenyang and began churning out small batches of home brew from a shop near the east gate of the old city wall. The business, originally called the Yilongquan Aquavit Workshop, quickly became known among locals after its position near the circular entrance to the city wall, whose shape was said to resemble a dragon's mouth. Visitors to Laolongkou are greeted by the unmistakable smell of fermenting sorghum, an earthy and slightly acrid odour that together with the grain alcohol lends an intoxicating quality to the air. Middle-aged workers in one section shovel raw sorghum and grains from canvas sacks into a giant metal tub. There they are steamed until the husks and chaff fall away, in preparation for a production process that will take 75 days. Work is broken into stages, and at each key point the workers conduct taste tests of the virgin spirits - some 65 to 70 per cent alcohol - to be sure things are proceeding as they should. The raw version, before it has been allowed to age, is pure firewater. 'We spit it out otherwise we wouldn't get anything done,' one worker said. But the grains do not go to waste. Another worker at the plant shovels the sorghum leftover from the distillation process into the bed of a pickup truck. He stands on top of the steaming mass of earthy, potent-smelling grain and tamps it into the truck bed with his boots. 'We sell it as a compact for sore joints,' he said. 'If you leave it on for two weeks your pain goes away. It removes the heat.'