Japanese beer is expanding its presence in South Korea's imported beer market. Sales collapsed in 2019 amid a boycott of Japanese products, but imports have rebounded quickly and returned to earlier levels. While the overall beer import market remains below its past peak, Japanese brewers are accelerating their push into Korea through expanded brand experience spaces and local production.
Japanese beer imports totaled $75.22 million in the first nine months of this year, according to Korea Customs Service trade data released on the 26th. That is up about 25% from $60.20 million a year earlier and equals roughly 95% of last year's full-year total of $79.15 million. Depending on shipments over the rest of the year, the annual figure could surpass last year's level.
Import volumes are also rising. Japanese beer imports in the third quarter reached 37,466 tons, up 24.3% from a year earlier. Japan's share of all imported beer by weight climbed to 48.4% from 43.3% over the same period, a gain of 5.1 percentage points. That means roughly one in every two bottles of imported beer is now Japanese.
The rebound stands in sharp contrast to the boycott years. Japanese beer imports fell to $39.76 million in 2019 from $78.30 million in 2018, then plunged to $5.67 million in 2020. Imports have since recovered, and last year's total exceeded even the 2018 figure recorded before the boycott.
The gains look even more striking against the broader import market. Total beer imports into Korea fell about 30% to roughly $215.80 million last year from $309.68 million in 2018. Even as the overall market shrank, Japanese beer has expanded its share and established itself as a leading import.
Kirin Turns to Local Production, Cutting Logistics Costs and Widening Consumer Reach
Strategies at Japanese brewers and their Korean distributors are also shifting. Rather than simply importing and selling finished products, they are using local production to shorten supply times and redirecting the savings into marketing and promotions.
HiteJinro said on the 12th that it has signed a technology licensing agreement with Japanese brewer Kirin and begun producing Kirin Ichiban Shibori canned beer at its Jeonju plant. Initial domestic output is targeted at about 1.5 million liters, and the company plans to produce 75% of total sales volume in Korea next year.
"By applying Kirin's proprietary brewing methods, ingredients, production processes and quality control standards at the Jeonju plant, we can now reproduce the taste and quality of the Japanese original here in Korea," HiteJinro CEO Jang In-seop said at a press briefing held on the 8th at the company's integrated research center in Yongin, Gyeonggi Province. "Local production will allow us to build a stable supply system."
The company said it is the first case in Asia in which an importer and distributor with no equity ties to Kirin has produced the beer under a license agreement. The strategy is to preserve the Japanese brand's identity while using domestic manufacturing to improve supply efficiency.
The biggest change from local production is lead time. Products brewed in Japan previously took about a month and a half to clear customs and reach Korean shelves, but that can now be shortened to one or two weeks, according to the company. HiteJinro said it will reinvest the savings on logistics into marketing and promotional activities to expand consumer benefits.