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The latest statistics show that in 2024, China's enterprises above designated size accumulated liquor production of 4.145 million liters, down 1.8% year-on-year. Since reaching the peak of production capacity in 2016, China's liquor has continued to "shrink", and the annual production capacity of 2023 is about 6 million liters.

According to the capacity calculation in 2024, the average capacity per capita is about 3 liters (4.14 million liters ÷ 1.4 billion people), while the per capita capacity in 2023 is about 4.5 liters, and the peak in 2016, the per capita capacity is about 10 liters (China's liquor capacity in 2016 was 13.5836 million liters).

In other words, China's liquor production capacity has shown a downward trend, and China's per capita liquor production capacity has shrunk by about 70% since 2016.

From the market level, per capita liquor production capacity is not equal to per capita consumption - according to statistics over the years, the annual market consumption is lower than the total annual capacity, and some of the finished products in the year are converted into inventory. Based on the aging characteristics of liquor, some enterprises will convert part of the current production capacity into aging base wine.

In this way, even with the addition of some historical inventory market digestion factors, the per capita liquor consumption in 2024 should be less than 3 liters.

So, compared with the international market, China's spirit per capita consumption power performance?

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According to data released by Statista, global spirits consumption in 2022 was 35.4 billion liters. According to the report, spirits consumption per capita in Europe is the highest in the world, and the Czech Republic is the largest alcohol consumption per capita in Europe, consuming 14.3 liters of pure alcohol per capita per year.

Europeans aged 15 and over consume an average of 9.5 litres of pure alcohol per person per year, equivalent to 190 litres of beer, 80 litres of wine or 24 litres of spirits, according to the WHO's annual report on health in Europe.

Distilled Spirits Council of the United States data show that in 2022, the United States spirit manufacturers caliber sales reached 2.745 million tons. With a population of about 330 million in the United States, it is estimated that spirits consumption per person is about 8.3 liters (2.745 million tons / 330 million people).

In 2022, the caliber revenue of American whiskey manufacturers reached $12.553 billion, accounting for 33.4% of the volume. Whisky is the largest category in the US spirits market, with approximately 916,000 tonnes of whisky sold in 2022 (at 33.4% share) and approximately 2.8 litres of whisky consumed per capita.

From the perspective of trend, the per capita consumption of spirits in Europe and the United States is on the rise. Since 1997, the per capita consumption of spirits in the United States has increased by more than 40%. In 2022, the size of the US spirits market reached $37.6 billion, an increase of 5.1%.

Statista predicts that between 2023 and 2027, the spirits market revenue is expected to maintain a compound annual growth rate of 4.56%.

In this way, the per capita consumption and total consumption of the international spirits market are still on the rise. So, after eight years of contraction (2016 to date), when will Chinese baijiu bottom out?

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