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'Chuhai' Competition Heats Up As Beers Sales Slow

Posted on: Tuesday, 6 September 2005, 12:00 CDT

Sep. 6--OSAKA -- Japanese brewers are fiercely competing to sell canned shochu drinks with low alcohol content -- known as "chuhai" -- to deal with flagging beer sales.

Sapporo Breweries Ltd., one of the nation's four top breweries, marketed the low-alcohol-content beverage for the first time in eight years in September when it rolls out a drink called the Fruit Sparkling.

And its introduction means that the four top beer makers in Japan are in the race to sell chuhai, a combination of shochu, a traditional Japanese distilled spirit, and fruit juice or carbonated water. Chuhai an abbreviated term for "shochu highball." Sapporo previously backed away from the chuhai market after being in business for two years because its product was relatively expensive and not doing so well.

It is more optimistic this time around as woman seemed to like the drink during test sales.

"A type of chuhai putting emphasis on fruit juice is popular among women," said a clerk at the Kiba branch of Ito-Yokado Co. in Tokyo.

Analysts say women hold the key to the success of canned chuhai, and beverage makers have been successful in changing the image the concoction, which had a reputation of being a cheap drink favored by old men.

Kirin Brewery Co. started the rage for drinks with low alcohol content in 2001 when it marketed "Hyoketsu," canned shochu mixed with fruit juice. It improved the image of the drink by putting it in a flashy can.

People liked it, and it opened the market for these drinks.

Shipments last year exceeded 100 million cases -- double that five years ago. Kirin leads the chuhai market with 40 percent market share.

But while these products get popular, beers sales continue to drop.

The cheap price of chuhai is considered to be one reason it is popular. A 350-milliter can of beer costs about 200 yen, while Chuhai costs between 100 yen and 150 yen.

But the sales growth of chuhai and other beverages with low alcohol content are starting to slow after showing uninterrupted double-digit gains until last year. Industry sources predict that the growth rate may fall below 10 percent.

Kirin Brewery President Koichiro Aramaki said these drinks may have matured in the market. But breweries are still hoping sales will continue to grow even if at a slower pace.

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Source: Kyodo News International, Tokyo

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