Budweiser to build a new brewery - food tech news in asia

Global beer giant, Budweiser, invested 2 billion RMB (US$283 million) to build a new brewery in Wenzhou city, China. The new brewery is the first “Green and Intelligent” brewery in China and will be officially put into operation in October this year.

Budweiser (Wenzhou) Brewery is one of the biggest investment by Anheuser-Busch InBev, it is located in Wenzhou Economic and Technological Development Zone and positioned as the global benchmark factory of Budweiser, with a production capacity of 600,000 tons in the first phase. The brewery is advanced in automation and intelligence, mainly producing Budweiser beer, Harbin beer, Double Deer beer, and other beer brands strive to become the world’s most efficient brewery of Anheuser-Busch InBev in 3 years time.

According to Euromonitor, Anheuser-Busch InBev is in third position with a 16% market share in China. China is the largest-volume and fastest-growing beer market in the world. After listing its Budweiser APAC in Hong Kong last year, Anheuser-Busch InBev has been looking to expand in Asia, especially in China, South Korea, India, and Vietnam. However, local beer brands are still dominant in China. China Resources Beer has more than 25% market share in the Chinese beer market. Its popular Snow beer is the top-selling beer in the world by volume and the largest local brewer by market value, followed by Tsingtao Brewery and Chongqing Brewery. The local Chinese brewers have a strong presence in the regional share market. The competition is fierce between local brewers and global beer giants.

Except to build a new brewery to ramp up its production in China, Budweiser APAC also plans to invest more in its e-commerce business as the coronavirus changes consumers’ habits and hit demand from restaurants and nightspots. The company sees very strong double-digit growth in e-commerce, especially the new models of O2O such as Meituan, Ele.me, which are China’s two dominant food delivery platforms.

Some big players in the beer market have already acquired domestic brands, as local players have strong local expertise and distribution networks; so acquisitions of local beer companies can be one of the strategies for Anheuser-Busch InBev. The premium segment only accounts for about 16% of the total beer market in China, while in Western countries it accounts for 40%; this means China is offering huge growth potential in the beer market.

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