Spirits sales slump sharply

A liquor store that sells Moutai in Qionghai, Hainan province, in February. The price of the luxury liquor brand has slumped since the country's new leadership launched a campaign targeting government spending on official receptions, vehicle purchasing and overseas trips by civil servants early this year. Meng Zhongde / for China Daily

The price of Chinese high-end liquor has dropped sharply, or even halved, this year, due to the government's reining in of lavish spending as part of its anti-corruption drive.

Baijiu, particularly the most expensive kinds, has traditionally been sought after for official banquets and as gifts, but that has changed.

Premier Li Keqiang vowed in March to reduce government departments' spending on receptions, vehicles and overseas trips.

Liu Yuan, secretary-general of the China National Association for Liquor and Spirits Circulation, said that before Spring Festival in February liquor retailers were already heavily discounting stock.

Moutai, the best-known Chinese liquor brand, is often cited in corruption cases as being proffered by those seeking to influence the powerful.

With the government placing restrictions on official spending on ostentatious dining and entertainment, the price of Moutai has fallen for the first time in nine years.

Last year it was selling for more than 2,000 yuan ($322) a bottle. But last month, the online retail price for Moutai was only about 900 yuan, just 100 yuan more than the factory price.

Over the past two months, high-end Chinese spirits have been selling at a discount because of the quiet market, the Chinese business newspaper Money Week reported.

"Most people buy Moutai as a present,"said a liquor shop owner in the Fengtai district of Beijing who has been selling Moutai and other liquor for five years.

"People who drink Moutai usually don't buy it themselves. It has become a status symbol, something that doesn't really fit into most people's lives."

Popular spirits in his shop cost about 60 yuan a bottle.

High-end Chinese spirits apart from Moutai, such as Wuliangye and Luzhou Laojiao, are also on sale, at a discount of 10 percent, or about 100 yuan.

"When Moutai was selling for more than 2,000 yuan last year I sometimes sold out. But now, even after steep price falls, sales are slow,"the shop owner said.

Some experts have suggested that Chinese liquor makers change their marketing strategy.

"Clearly there has been a change in demand, and the industry will need to adapt,"Ji Zhengkun, president of the China Association of Standardization, said.

"Chinese liquor businesses have relied too much on government consumption, and now they need to cater more to ordinary consumers."