| TOKYO, July 3
TOKYO, July 3 Japanese brewers will release
their longest-ever line-up of canned cocktails this summer as
fizzy concoctions come to the fore in efforts to offset a decade
of declining beer sales.
Brewers such as Kirin Holdings Co Ltd have long
tried to retain drinkers by making ever-cheaper, beer-like
beverages. But changing tastes among Japan's youth have seen
beer drinks giving up fridge space to highballs, white-wine
spritzers and pineapple-flavoured rum cocktails.
These so-called Ready-to-Drink (RTD) cocktails, like the
cheapest beer-like drinks, fall into a low-tax category of
Japan's complex liquor tax regime and can be priced far less
than traditional tipples. This has helped them become the top
introduction to alcohol among 20-somethings, according to a
survey from brewer Suntory Holdings Ltd.
In response to rising popularity, Suntory plans to release a
record 23 canned cocktail labels from June to August versus 17
last year. Asahi Group Holdings launched a hot-seller
in May, and Kirin announced a new range in June.
The increased choice means "this will be an important summer
to further boost demand in RTDs," Suntory Managing Director
Shinji Yamada said.
Demand is likely to be so strong that Suntory plans to raise
output for its Strong Zero series of canned cocktails by a tenth
this summer, and may increase production capacity for next
summer, Yamada said.
READY TO DRINK
The Ready-to-Drink market has almost doubled since 2001
whereas traditional beer sales have nearly halved, showed data
Sales of beer have slimmed as once-universal drinking binges
among office workers go out of fashion and Japan's increasingly
health-conscious youth develop a taste for drinks containing
Brewers have tried to stem the decline by lowering prices.
By reducing the malt content, brewers created beer-like drinks
which could be priced less because they qualified for lower tax
In Japan, beer is taxed based on malt content. The
lowest-taxed beer-like drinks - dubbed "third beer" - are made
with little malt or malt alternatives. In contrast, distilled
spirits such as the cocktail ingredient vodka are taxed at
higher rates based on alcohol content.
Due to a peculiarity in Japan's decades-old tax regime,
however, Ready-to-Drink cocktails are taxed at the same rate as
third beer, provided alcohol content does not exceed 9 percent,
giving the drinks the appeal of both variety and price.
Suntory's Strong Zero vodka tonic, for instance, is priced
at 152 yen ($1.49) for 350ml (12 fl oz) compared with 260 yen
for its The Premium Malt's beer.
This year, Ready-to-Drink sales are likely to grow 3 percent
to 13 million cases compared with a 1 percent decline in beer,
according to Suntory. The brewer, which controls more than a
third of the market, aims for RTD growth of 3.8 percent.
On the heels of Suntory is Kirin, which is looking to grow
its Ready-to-Drink business by 8.4 percent this year with the
help of its new Bitters line.
Late-comer Asahi stormed the market in May in the
quickest-growing category of "strong" RTDs, where alcohol
content is at least 8 percent. The brewer aims to ship 2.5
million cases of a highball made with distilled drink shochu by
the close of 2014.
"We sold 450,000 cases by the end of May," an Asahi
spokesman said. "So we're off to a good start."
($1 = 102.0500 Japanese Yen)
(Editing by Christopher Cushing)