Due to Continued Economic Growth, Beer Consumption Continued to Increase in 2011

Tuesday 15 January 2013, Amsterdam

Being the most developed region in the country, competition in east China was fiercer than ever before in 2011. Due to continued economic growth, beer consumption continued to increase in 2011. Brewers in China raised product prices as they fought soaring raw material costs and low profit margins. CRSB made a number of acquisitions of breweries, Tsingtao also made an acquisition and international brewer A-BInBev increased its investment in the region.

The populations of Shanghai, Jiangsu, Zhejiang, Shandong and Anhui are around 16 million, 74 million, 47 million, 91 million and 63 million respectively. The total population of east China is almost 306 million or about 22% of the total; the region has the highest population density in China. Due to the comparatively developed economy in the Yangtze River Delta, particularly in Shanghai, there is a high level of population migration as many people from the central and western regions arrive looking for jobs.

East China has long been a major beer market in China. Although there are only four provinces and one city, consumption is much higher in the east than in west and south China, and nearly the same as in north China.

Shandong province is the home market of the famous brewer Tsingtao. Tsingtao has three of the top ten brands in east China, including Tsingtao, Laoshan and Shanshui. In 2011, an expansion project was initiated to increase the capacity of the Taizhou brewery in Zhejiang province to 4m hl. In its hometown, Tsingtao Beer (Heze) Company is planning to move to the site of a 4 mhl new production base, with construction planned to start at the beginning of 2012.