E-Malt.com News article: New Zealand & China: New Zealand craft brewery to ship second container to China despite ongoing coronavirus concerns

A Christchurch, New Zealand craft beer company is getting ready to ship its second container of beer to China despite ongoing concerns over the coronavirus, Stuff.co.nz reported on March 5.

Alisdair Cassels, director of Cassels Brewery Company, said the company saw a future in the Chinese craft beer market even amid the current climate of uncertainty.

"We asked our agent over there if we should keep sending the beer or redirect it to England but he said yes, that this would be just a two month thing," Cassels said.

"Life will keep moving forward."

The beer, which was awarded the 2019 World Beer Awards World's Best Milk Stout, costs about 10 times the price of normal beer in China and was targeted at the higher end of the market, Cassels said.

"Globally, the craft beer makes up around 10 per cent of the market, in China it's just 1 per cent," Cassels said.

"There is huge potential for growth."

It took the company 18 months to crack into the Chinese market and the first container was shipped last month.

A third container of beer would leave for China at the end of March.

Each 40-foot container had NZ$100,000 worth of beer, marking a significant investment for the company, Cassels said.

In 2017, the brewery commissioned a new $2 million bottling plant to produce 888ml bottles designed for export to Asia.

At the time, Cassels said the 888ml bottle was chosen because the number 888 is considered auspicious by Asian consumers.

Head brewer Daniele Danesin said the beer would appeal to the Chinese market because of its quality but also as a New Zealand made product.

"If you have on your label that you are the best stout in the world, as we do, it's pretty easy to sell," Danesin said.

"New Zealand needs to remember that people overseas are looking for something different. We need to always think bigger, there is a huge potential there."

China is the largest beer market in the world with an annual consumption of 45.7 billion litres, twice as much as the United States, and significantly more than New Zealand's 298 million litres.

While Cassels was optimistic about future sales in China, global alcohol producer Anheuser-Busch announced a significant hit from the spread of the coronavirus, also known as Covid-19.

Investors were told on February 28 that the outbreak had led to a significant decline in demand in China in both on-premise and in-home channels.

"Additionally, demand during the Chinese New Year was lower than in previous years as it coincided with the beginning of this outbreak. For the first two months of 2020, we estimate that the outbreak has resulted in lost revenue of approximately $285 million USD."

The company warned that its financial forecasts reflected the current assessment of the scale and magnitude of the coronavirus, which was still a fluid situation and could change.


06 March, 2020