By Diao Ying (China Daily)
Updated: 2008-05-29 12:50

Xiao Lou felt drunk when the earthquake jolted Sichuan province on May 12, not only because the world was wobbling but also because the air reeked of liquor.

Then the keeper of Jiannanchun's biggest liquor deposit saw the liquid flowing from its storage space, washing over his feet like an incoming tide. At some point, he was knee-deep in tipple.

The deposit was the biggest of Jiannanchun, the third-largest brand of baijiu (white liquor) - China's staple spirit - after Moutai and Wuliangye.

The company's chairman Qiao Tianming estimated the losses at 800 million yuan, a quarter of last year's profit.

A Jiannanchun plant destroyed in the earthquake. File photo

Destroyed supplies were of "basic liquor", which the firm had stored in Mianzhu, one of the counties most devastated by the quake, and would later refine into bottled liquor.

Qiao estimated about 40 percent, or 4,000 tons, of the firm's basic liquor supply, was lost in the disaster.

The longer baijiu ferments, the greater its value. Basic liquor must be stored at least two years before it's sellable, meaning the company would face a shortage in 2010, industry analysts said.

Basic liquor must be stored in ceramic containers to ensure quality, but these were exceptionally susceptible to the quake's destructive force. Thousands of such containers in Jiannanchun, each holding more than 1 ton of baijiu, were destroyed.

Qiao said that despite the loss of reserves and many injuries among the company's staff, he was thankful no employee died in the disaster. In the aftermath, workers scrambled to save what baijiu they could in whatever containers they could find.

Few other liquor makers were notably impacted by the quake. Wuliangye and Luzhou Laojiao said the impact on their operations was trivial.

Qiao expects production to resume a month from now, after the distillery is reconstructed.

"We will try to keep prices at pre-quake levels, but we can't assure that," the company's vice-general manager Yang Dongyun said.

Sichuan is a major production base for baijiu, and the province produced 860,000 kl, about a fifth of the national output, in 2007.

Liquor industry expert Shu Guohua said losses in Mianzhu and neighboring areas would impact domestic baijiu supplies, because many smaller liquor brands buy it from Sichuan and sell it under their own label.

"A supply reduction would mean many smaller brands would be unable to maintain quality," Shu said, adding that shortages could cause price rises in the near future.

(China Daily 05/29/2008 page13)