E-Malt.com News article: China: Brewery-backed online platform on a mission to grow craft category in China

A brewery-backed online platform providing information, ratings and reviews on craft beer in China is on a mission to grow the category, which currently accounts for just 1.5% of brews sold in the country.

Established by Shen Kai in 2015, Jiuhuar is said to be China’s first beer application to promote and develop the craft beer culture in the country, and now has more than half a million users.

It provides information on more than 9,000 bars in China, over 23,000 craft beer on its database, more than 200,000 reviews, and includes a discussion zone on the platform for consumers.

Shen told FoodNavigator-Asia that craft beer consumption in China only began about a decade ago, even though around 80% of Chinese consumers drink beer.

In 2020, craft beer sales reached RMB12 billion (US$1.8 bln), which is only 1.5% of total beer sales in China. Despite this, Shen anticipates China’s craft beer market will follow the trajectory seen in the US over the next five to 10 years.

The US craft beer market, began in the 1960s but became more popular in the 1990s with the rise of microbreweries.

In 2020, craft beers account for about 28% of US’s total beer sales, which is about RMB120 billion (US$18.6 bln).

Currently, 75% of craft beers consumed in China are imported, according to Shen.

“China has very low import tariffs for beers, but local brands are growing fast, accounting for more than one quarter of the total market,” he said.

Even though China is a major producer of beer, it is largely still a baijiu country, so Shen hopes to popularise the craft beer market with its innovative products.

Following the launch of Jiuhuar, Shen opened a brewery called 8 Pints. At 6,000 square meters, it produces more than 40 different types of beers annually.

It has its own canning, bottling, kegging lines and had full control from raw ingredients, formulation to packaging.

Shen then opened a beer cafeteria under 8 Pints in Shanghai, selling craft beer at a reasonable price.

While imported craft beer are typically sold around RMB50 (US$7.75) per pint, 8 Pints’ cost between RMB 20 to 30 (US$3-4).

It has started to franchise the 8 Pints brand and has 10 stores in China.

Following this, Shen decided to market and sell the beer under the Dream Brewing brand, comprising 40 SKUs from lager, IPA, stout to seasonal beers.

According to Shen, Chinese craft beers are well-balanced and use of local ingredients.

“China has very rich food heritage, so people know how to balance acidity, spiciness, sweetness and bitterness. So, craft beer in China is not on the extreme end of flavours, it is not too bitter or too sweet, unlike American beer.”

“Also, Chinese people like to use a lot of local ingredients to enhance the flavour. So you will see people adding Osmanthus flowers, peppercorn, jasmine flower, Longjing tea and oolong tea into beers. This is a very special characteristic of Chinese beer which is flavour enhancing.”

Dream Brewing is now working on a fruit beer series.

Currently, about 50% of Dream Brewing sales are through bars and bottles shops, 10% online, 30% in 8 Pints, and 10% through supermarkets.

According to Shen, sales grew about 45% year-on-year, including domestic and export markets.

Last year, Dream Brewing exported its products to Myanmar and Laos through its distributor based in the Yunnan Province. The beers are sold at bars and bottle stores.

Shen said the Yunnan Province is key for its expansion to South East Asia, especially in Thailand and Vietnam which shares the border, and has had interest from Singapore.

Dream Brewing was recently featured at the Food and Beverage Innovation Forum (FBIF) 2021.


13 September, 2021