The baijiu industry entered an accelerated clearing period in 2025.
According to China Alcoholic Drinks Association data, the baijiu industry's total production in the first half of 2025 was 1.9159 million kiloliters, down 5.8% year-over-year; sales revenue reached RMB 330.42 billion, up slightly by 0.19%; realized profits totaled RMB 87.687 billion, down 10.93% year-over-year.
Under market pressure, liquor companies face intensified channel inventory pressure. The China Alcoholic Drinks Association's "2025 China Baijiu Market Mid-term Research Report" shows that in the first half of 2025, 58.1% of distributors reported inventory increases, with over half experiencing price inversion issues. The average inventory turnover days for the baijiu industry reached 900 days, an increase of 10% compared to the same period last year.
Weak terminal consumption, slowing market sales, and declining distributor payment willingness created negative feedback loops, directly affecting liquor companies' shipment pace.
68% of Listed Baijiu Companies See Revenue Decline as "Volume Down, Price Up" Logic Fails
Among listed companies, 13 out of 19 baijiu listed companies experienced revenue declines in the first half, accounting for 68%, with revenue growth rates significantly slower than the same period last year.
Meanwhile, differentiation among baijiu companies intensified, with market share increasingly concentrating toward leading companies. In 2024, six leading baijiu enterprises accounted for 47% of revenue, up 13 percentage points from five years ago; their profit share reached 62.2%, up 9 percentage points from five years prior.
This differentiation also reflected in performance growth rates. In the first half, the median revenue growth rate for six baijiu enterprises with over RMB 10 billion revenue was 2.36%, while the median for 13 companies below RMB 10 billion was -16.89%.
Most notably, the baijiu industry's growth logic is changing. Previously, under the industry's overall "volume reduction" environment, leading liquor companies maintained growth through product upgrades, but this year the "volume down, price up" logic collapsed, replaced by simultaneous volume and price declines.
According to the China Baijiu Wholesale Price Index, national baijiu wholesale prices continuously declined from September 2024 to August 2025, with premium liquors showing the same trend.
Industry bellwether Feitian Moutai's wholesale price at the end of August was RMB 1,820, down RMB 840 from early September 2024. During the same period, eighth-generation Wuliangye dropped from RMB 960 to RMB 860; Guojiao 1573 fell from RMB 870 to RMB 835. In fact, the latter two are in inverted pricing situations. Taking Wuliangye as an example, on February 5, 2024, eighth-generation Wuliangye's factory price increased from RMB 969 per bottle to RMB 1,019 per bottle, while on e-commerce platforms, some stores offered final prices as low as around RMB 800.
Liquor Companies Begin Inventory Reduction as Revenue Declines While Inventory Grows
In this round of baijiu adjustment cycle, accompanied by weak terminal consumption, slowing market sales, and declining distributor payment willingness, liquor companies began controlling shipments and clearing channel inventory. This led to declining sales volumes alongside rapid inventory growth, while inventory turnover rates declined.
In the first half, 19 listed baijiu companies' total inventory reached RMB 168.325 billion, an increase of RMB 18.224 billion year-over-year, with growth of 12%, far exceeding revenue growth.
Fifteen baijiu companies saw inventory growth, accounting for 79%. Three companies had inventory growth rates exceeding 20%: Jiangsu King'S Luck Brewery, Sichuan Swellfun, and Anhui Gujing Distillery. Notably, Sichuan Swellfun's revenue declined by 12.84%. Only three companies reduced inventory: Huangtai Liquor, Laobaigan Liquor, and Golden Seed Winery.
According to securities research reports, in this adjustment round, small and medium-sized liquor companies, especially nationalized sub-premium brands, led inventory reduction efforts, followed by regional premium liquors and high-end baijiu.
Among listed companies, most small and medium-sized liquor enterprises showed trends of declining revenue and growing inventory. Twelve baijiu enterprises with revenue below RMB 5 billion had a median revenue growth rate of -17.15%, while their median inventory growth rate reached 10.86%.
Among the top four baijiu companies, except for Wuliangye's 5.33% inventory growth, the other three maintained double-digit growth, with Kweichow Moutai's inventory growing 15.08%, Shanxi Xinghuacun Fen Wine Factory growing 13.76%, and Luzhou Laojiao growing 11.58%.
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