Craft beer market sees big growth potential in Korea

Asia's Tech News Daily

Craft beer market sees big growth potential in Korea


Beer has long been a key ingredient of mixed drinks in South Korea, but changing appetites and the extended coronavirus pandemic have turned consumers toward diverse and unique flavors of craft beer.

Craft beer sales are on the rise, as a growing number of people work from home due to social distancing, and those people increasingly prefer more diverse and tasty beers to existing mass-marketed lagers and ales.

“Before the pandemic, I used to go to bars to have beer with my clients or friends after work. I recently found craft beer tasty and came to enjoy a diverse range of craft beer at my place,” Uni Park, a 32-year-old exhibition planner in Seoul, said.

During the past 1 1/2 years, some young people aged between 24-35 years have created a culture of enjoying craft beer purchased at convenience stores while watching Netflix movies and series at their homes, Kim Jin-man, a general manager at the Korea Craft Brewers Association (KCBA), said.

“Imported beer brands became popular in 2015 and 2016, as they provided ale and other diverse beer products. But in recent years, people preferred freshly brewed and even diverse local craft beer to imported beer, which underwent the brewing process sometime before shipment,” he said over the phone.

On top of changing demands and the prolonged pandemic, a revision in the liquor tax system also helped boost sales of craft beer in the domestic market.

Craft breweries’ share of the country’s 5 trillion-won (US$4.2 billion) beer market rose to more than 2 percent in 2020 from less than 1 percent a year earlier, the KCBA said.

Last year, South Korea implemented the revised tax system on beer for the first time in half a century in a move to address tax imbalances between imported and domestic beer.

The change ― the first since 1968 ― calls for a tax system based on volume rather than an ad valorem tax, a charge levied on prices of beer.

Any beer ― regardless of production costs or retail prices ― is subject to an 830.3 won (72 cents) per liter liquor tax under the new tax system.

The previous ad valorem tax allowed imported beer brands to pay lower taxes than their Korean competitors, an imbalance that has led to an increased share of imported beers in Korea in recent years.

In South Korea, Jeju Beer is the leading player in the craft beer market. There were 159 craft brewing business registrations as of August, and 50 of them were registered as KCBA members.

Jeju Beer, whose brands launched in 2017, has introduced three major ales in the domestic market and recently began to export them to European markets, such as Germany, Britain and France.

“We expect double-digit sales growth this year from a year earlier, helped by changing market demand for beer and overseas sales of our products,” Jeju Beer founder and CEO Moon Hyuk-kee told Yonhap News Agency in August.

Jeju Beer’s entry into the Korean outlets of U.S. retailer Costco Wholesale in June will also help its sales for the year, he said, adding Jeju Beer products will be also be available at Costco’s British outlets within this year.

Last year, the Jeju-based company hit the shelves of the country’s five major convenience stores ― GS25, CU, 7-Eleven, Ministop and Emart 24. About 10 craft brewers currently sell their products at convenience store outlets across Korea.

Increased sales channels buoyed Jeju Beer’s sales to 32 billion won last year from 15.1 billion won a year earlier. Jeju Beer accounted for 28 percent of the local craft beer market.

Craft beer market sees big growth potential in Korea

In this Marcy 21 file photo, a customer picks a can of craft beer at a retail outlet in Seoul. Yonhap

Still, the country’s 118 billion-won ($99 million) craft beer market pales in comparison with the $22 billion U.S. market in terms of size and number of participating companies.

Craft beer makers account for 25 percent of the U.S. beer market, while the proportion stands at less than 3 percent in South Korea.

Given this, the KCBA expected the Korean craft beer market to reach 370 billion won in 2023, jumping from 118 billion won in 2020 and 43.3 billion won in 2017.

Daishin Securities forecast craft brewers will account for 9 percent of the local beer market in 2023, up from the current 2.4 percent. Mass-marketed lager firms’ share is projected to fall to 74 percent from 82 percent, and imported beer brands’ share is forecast to rise to 17 percent from 15 percent during the same period.

During the past decade, some 50 craft beer brands in the U.S. made investments in facilities and products, which in turn boosted the U.S. craft beer market. Currently, the number of U.S. craft beer brands stands at around 4,000.

“Local craft beer makers need to take a similar path by making investments in automation to achieve the economies of scale and compete with import rivals,” the Jeju Beer CEO said.

The local beer market has been dominated by two major firms ― Oriental Brewery (OB) and Hite Jinro Seven years ago, Lotte Chilsung Beverage jumped into the market.

During past decades, their focus was on selling lager, as demands for the mass-produced beer were strong enough to prop up their bottom lines.

In Korea, beer has been a key ingredient of “poktanju,” mixed drinks with such liquors as whiskey and soju, a traditional Korean liquor.

Poktanju ― which is usually made by dropping a shot glass full of whiskey or soju into a glass of beer ― is often served during office celebrations and parties in South Korea, where after-work drinking as a means to strengthen camaraderie among co-workers has long been a part of business culture.

But growing interest in health and wellness, as well as changing demands has weighed on sales of lager products. Moreover, people have raised questions about the taste of lager.

Critics and foreigners once claimed North Korea’s Taedonggang beer, named after a river that runs through the North Korean capital Pyongyang, is infinitely superior to the mass-marketed beers in the South.

Taedonggang beer, available in Seoul until 2007, is a full-bodied lager that is a little on the sweet side, with a slightly bitter aftertaste.

Faced with the growing popularity of craft beer, the three major lager companies are expected to step up their efforts to diversify their lineups.

In 2018, OB acquired the entire stake of local craft beer firm Hand Malt Brewing to meet the rising demand for craft beer among consumers.

Hite has no immediate plans for business partnerships and investments to expand its craft beer business, but it imports products of the British craft ale firm BrewDog for local sales.

“Craft beer appears to be making a presence, with ‘diversity’ having emerged as a key word among consumers,” an OB official said. “We are planning to introduce a series of craft beer products through business partnerships in the coming years.” (Yonhap)

Internet Explorer Channel Network
Asia's Tech News Daily
News Related


Strengthened social distancing rules to impact leisure, aviation industries

An Asiana Airlines flight attendant serves inflight meals / Courtesy of Asiana Airlines By Kim Hyun-bin The government has strengthened social distancing measures by making it mandatory for all inbound ... Read more »

KOSPI moving in tandem with US futures amid heightening Omicron uncertainty

Dealers at Hana Bank work at a dealing room at the lender’s headquarters in Seoul, Friday. Yonhap By Lee Min-hyung Korea’s benchmark KOSPI had been moving in sync with Wall ... Read more »

Poet Kim Hye-soon wins Swedish literary prize

The Cikada-winning poet, Kim Hye-soon / Yonhap By Park Han-sol Poet Kim Hye-soon was named the winner of this year’s Cikada Prize, a prestigious Swedish literary award that recognizes East ... Read more »

Travelers upset by 'sudden' announcement about 10-day mandatory quarantine

Staff members wearing protective gear guide passengers at the Incheon International Airport In Incheon, Dec. 1. AP-Yonhap Travelers returning home Friday from short-term overseas trips were embarrassed to learn that ... Read more »

WTO joint statement to enhance transparency in services industry

gettyimagesbank By Lee Kyung-min Korean firms will be able to expand their overseas business more efficiently, a move outlined in a joint initiative statement signed by 67 member countries of ... Read more »

Omicron fears prompt Samsung, LG, Hyundai to consider Plan B for CES

People arriving from overseas are being guided by quarantine officials at Incheon International Airport, Friday, when the government began imposing strengthened quarantine measures, requiring all international arrivals to undergo a ... Read more »

Omicron takes toll on conglomerates' business management

Local conglomerates takes precautionary measures due to the new cases of the Omicron variant. Korea Times file By Kim Hyun-bin The strain of the Omicron variant of COVID-19 is spreading ... Read more »

S. Korea, US to discuss possibility of advancing OPCON transfer assessment date

South Korean Defense Minister Suh Wook (R) and his U.S. counterpart, Lloyd Austin, bump fists after a joint press conference following the 53rd Security Consultative Meeting (SCM) at the defense ... Read more »

Lee, Yoon tie at 36 percent support in presidential race: survey

Lee Jae-myung (right), presidential nominee for the ruling Democratic Party of Korea, exchanges greeting with Yoon Seok-youl (left), presidential nominee for the main opposition People Power Party, during an event ... Read more »

AMCHAM and ruling party presidential candidate meet to discuss support for foreign investments

American Chamber of Commerce in Korea (AMCHAM) Chairman & CEO James Kim, front row fifth from left, and ruling Democratic Party of Korea (DPK) presidential candidate Lee Jae-myung, front row ... Read more »

KB set to extend terms of non-banking leaders

From left are KB Securities co-CEOs Park Jeong-rim, Kim Sung-hyun and KB Insurance CEO Kim Ki-hwan. Yonhap By Lee Min-hyung KB Financial Group is set to extend the terms of ... Read more »

Moon to meet conglomerate heads later this month: reports

South Korean President Moon Jae-in (Yonhap)South Korean President Moon Jae-in is planning a meeting late this month with heads of major local conglomerates to thank them for participating in government-led ... Read more »

First recruit for Lee Jae-myung campaign offers to resign over marriage controversy

Cho Dong-youn, a professor of military studies at Seokyeong University, answers questions from reporters Tuesday after being appointed as a co-chair of the election campaign committee for the ruling Democratic ... Read more »

China supports declaration of Korean War's end: Chung Wa Dae

South Korea’s national security adviser Suh Hoon (left) met with top Chinese Communist Party diplomat Yang Jiechi in Tianjin, China on Thursday. (Yonhap) Top Chinese Communist Party diplomat Yang Jiechi ... Read more »

13 Chinese rescued from sinking fishing boat in southern waters

This photo provided by the Yeosu Coast Guard on Friday, shows a rescue operation of sailors from a sinking Chinese fishing boat in the southern waters of South Korea. (Yeosu ... Read more »

Moon encourages charities, promotes year-end donations

President Moon Jae-in (2nd from L) and his wife, Kim Jung-sook, put an unspecified amount of a donation into a collection box of the Red Cross Korea during a donation ... Read more »

Yoon unlikely to face indictment in political meddling case

This photo, taken on Nov. 23, shows Yoon Seok-youl, the presidential candidate of the main opposition People Power Party (PPP), speaking at an event with college students in Seoul. (Yonhap)Main ... Read more »

Unification ministry budget for inter-Korean cooperation rises 2% in 2022

Ministry of Unification (Yonhap)The unification ministry’s next year budget for inter-Korean cooperation slightly increased despite chilled cross-border exchanges in the face of deadlocked nuclear negotiations and the North’s prolonged border ... Read more »

All international arrivals to South Korea must undergo 10-day quarantine

A man wearing a mask stands at Incheon International Airport in Incheon, South Korea, on Tuesday. (Reuters photo) SEOUL: From Friday, all arrivals to South Korea regardless of their nationality ... Read more »

Two Korean villages designated UN's Best Tourism Villages

The Purple Island in Sinan, South Jeolla Province (Sinan County)The Purple Island in Sinan, South Jeolla Province, and Ungok Village in Gochang, North Jeolla Province, have been included in the ... Read more »

Top Chinese official expresses support for Seoul's pursuit of end-of-war declaration: embassy

(Yonhap)A top Chinese official in charge of foreign affairs said Beijing supports Seoul’s push for the declaration of a formal end to the 1950-53 Korean War, according to South Korea’s ... Read more »

Navy set for launch of light carrier project, spurred by budget passage

Shown in this file image released by the Navy on Nov. 8, 2021, is a rendering of South Korea’s first light aircraft carrier, which is expected to be built by ... Read more »

Activists find hope in technology to stop animal cruelty in fashion, scientific research

Holding a banner reading, “I Am Not Food,” activists from the animal rights group, CARE, protest against dog meat consumption in Gwanghwamun Square, central Seoul, in this January 2018 file ... Read more »

Chinese ride-hailing giant Didi to delist from New York exchange

The logo for Chinese ride-hailing company Didi Global is pictured at the New York Stock Exchange floor in New York City, June 30. Reuters-Yonhap Chinese ride-hailing giant Didi Chuxing said ... Read more »

Dreamworld to open new Steel Taipan rollercoaster on December 15

It’s 1.2km long, tops 100km/h and sends you through two corkscrews and a barrel roll Get ready thrillseekers: The biggest rollercoaster in Dreamworld’s history has a launch date. The long-awaited ... Read more »

Plan to open Abel Tasman to bikers and hikers with long-distance route

Abel Tasman operators are hoping to cut through coastal bush and DoC management plan reviews to create a long-distance cycle trail to address the long winter season. Last month a ... Read more »

Hobsonville Point 'community hero' spreads joy with fairy houses

You may not believe in fairies but one Kiwi woman’s lockdown project can only be described as magic. When New Zealand went into its first lockdown last year 66-year-old Jo ... Read more »

Miroslav Zikmund Czech grandfather of travel writing dies 102

Miroslav Zikmund, a legendary Czech travel writer, has died. He was 102. The museum in the eastern city of Zlin, where Zikmund had lived, announced his death in a statement, ... Read more »

Crocodile attacks British backpacker on Zambia rafting trip at Victoria Falls

A teenager was pulled from her boat by a 3-metre crocodile near the Victoria Falls in Zambia. Midday on Tuesday Amelie Osborn-Smith, 18, from Hampshire had been on a guided ... Read more »

Nat'l Assembly passes record W607.7t govt. budget for 2022

Parliament holds a plenary session for the revision of the youth protection act on Nov. 11. (Yonhap)The National Assembly passed the 2022 government budget Friday, a record high amount of ... Read more »

Number of critically ill COVID-19 patients hits record high

A medical worker wearing personal protective equipment checks a coronavirus disease (COVID-19) patient inside the intensive care unit of the Bagae Hospital in Pyeongtaek, Dec. 1. EPA-Yonhap South Korea’s daily ... Read more »

London's Big Ben revealed after years under scaffold and it's blue!

Big Ben has undergone a big restoration. After four years under scaffolding, Londoners were surprised to see the clock face on the Thames was painted gold and blue. The face ... Read more »

[Graphic News] S. Korea's 2021 rice output rises for first time in 6 years

South Korea’s rice output rose for the first time in six years due mainly to favorable weather conditions and an increase in the cultivation area, data showed. The country’s rice ... Read more »

UN excludes N. Korea from humanitarian aid plans for two straight years

(Reuters)The United Nations has excluded North Korea from its global humanitarian assistance plan for 2022, its recent report showed, apparently due to the impoverished country’s prolonged border lockdown against the ... Read more »

Gov't to limit private gatherings to 6 in capital area, 8 elsewhere

A man wearing protective gear sprays disinfectant as a precaution against the coronavirus at a temporary screening clinic for the coronavirus in Seoul, Dec. 1. AP-Yonhap South Korea will limit ... Read more »

Woori union denies plans to participate in management

Woori Financial Group Chairman Son Tae-seung attends a meeting with Financial Supervisory Service Governor Jeong Eun-bo at the headquarters of the Korea Federation of Banks in Seoul, Nov. 3. Joint ... Read more »

Tivoli Gardens in Copenhagen open despite pandemic

The amusement park in Denmark remains open for Christmas this year. Amid reported rising concern about the omicron variant, Denmark’s Tivoli Gardens opened to the public two weeks ago. Tivoli ... Read more »

Heathrow Airport reopens Terminal 4 for red list country arrivals

HEATHROW Airport has reopened Terminal 4 as a dedicated facility for processing arrivals from red list countries from today. The west London airport said the measure will keep passengers arriving from ... Read more »

Cheap UK-US flights to New York & Florida launch this month – and they start from just £179

A NEW direct flight route from the UK to New York has been launched, with fares from £179 each way. Aer Lingus launched its first direct flight from the UK ... Read more »

New Harry Potter attraction to open at Warner Bros Studio Tour next year

YOU can soon step behind the scenes of the pranks and tricks within the magical wizarding world of Harry Potter at a new attraction. 'Magical Mischief' is coming to the ... Read more »
On you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic