BAIJIU MARKET ANALYSIS

Baijiu MarketSize and Trends

Market Dynamics

• Increasing preference of baijiu among the populace and rising disposable income of consumers are key factors driving the global baijiu market growth. The drink can be stored for longer duration without any change in taste. Although, sorghum is a popular ingredient used to produce baijiu, other ingredients such as wheat, barley, rice, millet, and corn can also be used. Consumption of small amount of baijiu reduces the risk of Alzheimer’s disease, reduces the uric acid concentration in serum, helps to improves serum lipid profiles, decreases platelet aggregation, and reduces the risk of cardiovascular diseases. According to a report by the U.S. Department of Agriculture (USDA), China Alcoholic Drinks Association stated that consumption of baijiu in 2017 grew at the rate of 9% from 2016.
• Furthermore, increase in production of wheat and maize is expected to boost the supply of raw materials for production of baijiu and helps in growth of the global baijiu market. According to a statistics of Food and Agricultural Organization (FAO), the global production of maize was 1,060 million tons in 2016 and grew at the rate of 4.9% from 2015. Moreover, the global production of wheat was 749 million tons in 2016 and grew at the rate of 1.7% from 2015.
• However, baijiu contains high volume of alcohol (up to 65%) and its excessive consumption may lead to damage of liver and pancreas, experience of numbness, and affect the immune and digestive systems.

Market Trends

• Among the crop type, sorghum cereal segment accounted for the highest market share in the global baijiu market in 2017. This is owing to high preference of sorghum as a raw material due to its distinct flavor compared to other ingredients used to manufacture baijiu.
• Among the type of flavor, strong-flavor segment held dominant position in the market in 2017. This is owing to characteristics such as fragrant flavor, soft mouth feel, and aftertaste of strong-flavor baijiu. The segment is projected to hold dominant position in the market over the forecast period.
• Among region, Asia Pacific held highest market share in the global baijiu market in 2017. The region is projected to maintain its dominance over the forecast period as China is the largest producer and consumer of baijiu in the world. According to a report of the U.S. Department of Agriculture (USDA) in May 2018, consumption of baijiu in China is expected to grow at 12% rate in 2018. China consumed 12 billion liter of baijiu in 2017.
• Since consumption of baijiu is 99% in China and rest 1% is consumed in different parts of the world. In 2017, Kweichow Moutai Co. Ltd unveiled that the company has signed a MoU with San Francisco’s Mayor to expand the consumption of baijiu in America and the company will also export baijiu in 100 other nations.