Japan's brewers quench summer thirst with canned cocktails as beer sales slide

Wed Jul 2, 2014 8:20pm EDT
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By Ritsuko Shimizu and Chang-Ran Kim

TOKYO (Reuters) - 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-flavored 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 [SUNTH.UL].

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   Continued...

Cans of Suntory Holdings' "Strong Zero Dry" vodka tonic are displayed with other ready-to-drink cans of alcohol as a man shops at a supermarket in Tokyo June 29, 2014. REUTERS/Yuya Shino