In The First Half Of The Year, The Output Of Wine Industry Is Still Recovering. Why Is The Annual Profit Expected To Reach A New High?

On July 18, the China Liquor Industry Association released the data on the output and wine types of Enterprises above Designated Size in the national brewing industry in the first half of the year. After comparing the data from January to May and the first half of 2019, the reporter of 21st century economic report found that the output of the whole industry was still in the stage of recovery growth from January to June, and had not yet recovered to the level of the same period before the epidemic.

However, the economic operation of the brewing industry is in good condition. From January to April and from January to may, the total profit of the brewing industry increased by more than 36% year on year, and the annual benefit is expected to reach a new high.

The yield did not return to the pre epidemic level

According to the data released by China Liquor Industry Association, from January to June, the total liquor production of Enterprises above Designated Size in the national brewing industry reached 28.34 million kiloliters, up 6.8% year on year. However, compared with the same period in 2019 before the epidemic, there is still a gap of less than 300000 kiloliters.

According to the specific types of liquor, the output recovery and growth rate of Enterprises above the designated level in liquor industry was the fastest. In the first half of the year, the output of Liquor Enterprises above Designated Size reached 3.85 million kiloliters, up 12.8% year on year. Although the liquor industry had a rare double-digit growth, in the same period last year, due to the epidemic situation, liquor production decreased by 9% year-on-year. The cumulative growth rate of liquor production in the first half of 2020 and the first half of this year is only about 4%. On the whole, liquor production is still declining year by year.

Beer is also growing faster than the same period last year. In the first half of the year, breweries above Designated Size produced 18.89 million kiloliters of beer, up 10% year on year. In the first half of last year, China's beer production increased negatively. Since this year, beer production has not returned to its peak. Looking back on the first half of 2019, the national beer production was 4.48 million kiloliters.

It is wine that is weak in production growth. In the first half of last year, the output of wine enterprises above the designated level dropped by as much as 30% on a year-on-year basis due to the severe impact of the epidemic situation. In the first half of this year, wine production increased slightly by 1% year-on-year, and the total capacity of 130000 kiloliters was only about half of that in the same period in 2019. The total output of wine enterprises is only 3% of that of liquor enterprises, accounting for 0.4% of the scale of the whole wine making industry. How to expand the capacity rapidly, wine enterprises have not found an effective way.

In addition to the recovery growth of the output of major wine varieties, there are also exceptions. In the first half of the year, the output of fermentation alcohol enterprises on the scale did not increase but decreased.

It should be noted that the recovery rate of the major wine varieties slowed down in the second quarter. From January to February last year, due to the limited consumption scenarios caused by the epidemic situation, the beer production dropped by 40% year on year to only more than 3 million kiloliters, but recovered to 5 million kiloliters in the same period of this year; The output of wine in the first quarter of last year was 58000 kiloliters, down 40% year on year! More than the decline in beer and liquor.

In the second quarter, in a single month, the year-on-year growth rate of beer and wine production slightly increased or even decreased, resulting in the cumulative output growth rate of liquor industry was faster than that of other liquor varieties at the end of half a year.

The profit of liquor industry is expected to reach a new high

In the first half of the year, the growth of wine was the weakest, and the recovery of beer and liquor production did not reach the level of the same period before the epidemic. However, driven by the performance of liquor enterprises, the benefit recovery of the brewing industry reached a growth rate of more than 30%.

The economic data of the Ministry of industry and information technology on the wine making industry in the first half of the year has not yet been released, but the data released by the China Wine Association show that from January to may, the sales revenue of Enterprises above Designated Size in the national brewing industry reached 378.6 billion yuan, an increase of 23% over the same period last year; The total profit was 84.9 billion yuan, a year-on-year increase of 38%.

What is 84.9 billion yuan?

Leaving aside the severe damage to the epidemic industry last year, according to the National Bureau of statistics, in the first half of 2019, the total profit of Enterprises above Designated Size in the brewing industry was 85.7 billion yuan, an increase of 18% over the same period of last year. In other words, the benefits that can be completed in half a year have been basically achieved in five months this year, and the sales revenue has exceeded the same period in 2019.

The high growth rate is the reason for the continuous high benefit of liquor making industry.

According to the national economic operation data released by the National Bureau of statistics in the first half of 2021, the per capita disposable income in the first half of 2021 is 17642 yuan, and the consumption expenditure is 11471 yuan. Among them, the consumption expenditure of food, tobacco and alcohol of national residents was 3536 yuan, accounting for 30.8%, with a year-on-year increase of 14%. The consumption of food, tobacco and alcohol of urban and rural residents was 4378 yuan and 2446 yuan, respectively, up 12% and 18% year-on-year.

In the consumption of alcohol, liquor is the largest. Taking 2019 and 2020 as examples, the sales revenue of Liquor Enterprises above the designated level accounted for about 70% of the sales revenue of the liquor making industry. The profit level also comes from the liquor industry. According to the data released by the China Liquor Association, by the end of the 13th five year plan, the profits of Liquor Enterprises above Designated Size will reach 158.5 billion yuan, an increase of 117% compared with the end of the 12th Five Year Plan, and other liquor industries will decline.

After the release of the first quarter report, Sichuan financial securities, after investigating the market, put forward that the demand for high-end liquor was stable, the approval price was steadily improved, and the performance of the second quarter was expected to maintain high certainty. Secondary high-end liquor benefited from the promotion of high-end liquor approval and entered into a new growth cycle. The growth trend of volume and price remained unchanged, adding to the low base number in the second quarter of last year, it is expected that the performance of the first half of the year will be more flexible. During the disclosure period of the interim report, the growth of performance will become the main driving force.

Trend forecast of wine making industry in the second half of the year

So, what is the performance trend of liquor making industry driven by liquor in the second half of the year?

Guotai Junan released a research report that the trend of liquor plate in the newspaper is good. The demand for high-end liquor is strong and the development trend is good; The prosperity of secondary high-end liquor continued, and the quantity and price were good; Waist and public price differentiation, famous wine is better. The second half of the peak season is coming, the development of liquor industry is worth looking forward to.

According to an analysis report released by IWSR, an international wine and spirits research company, by the end of this year, the wine and beverage market in the Asia Pacific region is expected to grow by more than 2% and sales are expected to grow by more than 4%. By 2025, the overall consumption of alcoholic drinks in the Asia Pacific market will return to the pre epidemic level.

According to the "guidelines for the development of China's liquor industry during the 14th five year plan" issued by the China Liquor Association, the total liquor production of China's liquor industry will reach 66.9 million kiloliters by 2025, 24% higher than that at the end of the 13th five year plan, with an average annual increase of 4.4%; The sales revenue reached 1418 billion yuan, an increase of 70% and an average annual increase of 11%; The profit was 334 billion yuan, an increase of 86% and an average annual increase of 13%.

According to the annual average growth target of 13%, enterprises above Designated Size in China's liquor making industry achieved a total profit of 84.9 billion yuan from January to May this year, with a year-on-year increase of 38%. The actual growth rate has far exceeded the established growth rate. In the second half of the year, the peak seasons of beer, liquor and wine are coming one after another. It is a big probability that the total profit of the brewing industry will reach a record high this year.

However, according to the National Bureau of statistics, liquor production has been on a downward trend from 2016 to 2020, from 13.58 million kiloliters to 7.4 million kiloliters. Since liquor production has been going down all the way, how to realize the increment of liquor production during the "14th five year plan" period?

According to the guidelines for the development of China's liquor industry during the 14th Five Year Plan period, the proportion of famous and high-quality liquor will be greatly increased from 300000 kiloliters at present to 650000 kiloliters, and the proportion will be increased from 4% to 8%. It can be seen that at the end of 2020, based on the output of 7.4 million kiloliters of liquor, the output of Enterprises above the designated size will exceed 8 million kiloliters by 2025. The main driving force is the expansion of production capacity of famous liquor enterprises represented by Guizhou Maotai (600519. SH), Wuliangye (000858. SZ), Luzhou Laojiao (000568. SZ).

In the past five years, the liquor production decreased by nearly half, and the sales revenue decreased from 612.5 billion yuan to 583.6 billion yuan, but the total profit doubled from 79.7 billion yuan to 158.5 billion yuan!

In an interview with 21st century economic reporter, song Shuyu, assistant director of China liquor industry, pointed out that the liquor industry had entered a deep adjustment since the end of 2012 and gradually recovered in 2016, followed by a recovery period, which is a V-shaped shape.

He concluded that the first characteristic of the recovery period is that the production and sales volume of liquor have basically decreased year by year, reflecting the changes of market supply and demand and consumption demand; Second, the sales revenue of products realized the V-shaped reversal in the middle of the 13th five year plan, but the sales revenue per unit product increased year by year, and the market bargaining power of liquor products was gradually improved; Third, the profit level is increasing year by year, which shows the high-quality development process of liquor industry from quantitative change to qualitative change, and also reflects consumers' pursuit of rational and healthy consumption demands.

He said that in general, China's wine industry has gradually shifted from product centered to market and consumption centered, in order to adapt to the rapid transformation of market structure, and has achieved phased results under the new trends of supply side reform, consumption upgrading and Internet +.