China’s alcoholic drinks market weakened in the first half of 2025, dragged down by falling sales at traditional tobacco-and-liquor stores and a continued slump in wine consumption. Yet online channels, livestreaming sales, and a growing preference for lower-alcohol drinks offered rare bright spots in an otherwise sluggish market.
At the 14th China (Guizhou) International Alcoholic Beverages Expo, the China National Association for Liquor and Spirits Circulation released its first-ever Alcoholic Beverages Market Confidence Index (ACI) for January–June 2025. The index came in at 47.14, below the neutral benchmark of 50, suggesting the market is contracting.
The trade body, founded in 1995 with approval from China’s Ministry of Civil Affairs, based the survey on data from 27 provinces and cities, covering more than 1,000 specialty tobacco and liquor stores, over 100,000 general retailers, 500,000 supermarket outlets, and major e-commerce platforms.
The Decline of Banquet-Driven Sales
China’s tobacco-and-liquor stores—standalone retail outlets that rely heavily on sales for business banquets and corporate gifting—were hit hardest. Their ACI fell to just 39.19, with more than 60 percent reporting shrinking profits. Nearly a third of these shops saw earnings drop by more than 10 percent.
The weakness reflects a sharp reduction in official and corporate banqueting, once a cornerstone of China’s alcohol sales. At such events, premium baijiu—China’s potent national spirit distilled from sorghum and often bottled at 50% ABV or higher—traditionally dominates. Moutai and Wuliangye, the two leading baijiu brands, are widely recognised symbols of wealth and sincerity.
But wine, by contrast, struggles in this context. “At business banquets, alcohol is expected to signal value. When a host brings out Moutai or Wuliangye, everyone knows the price and recognises the gesture,” said Wu Yonglei, general manager of Fond Wine, a major distributor in Fujian province and one of China’s Top 100 Wine Importers. “Wine lacks benchmark labels that carry the same weight. Using wine for entertaining often requires lengthy explanations, which is awkward—so people simply avoid it.”
The report highlighted other structural problems for these outlets: shrinking margins on mid- to high-end baijiu due to pricing pressures, higher operating costs, and slow adaptation to new retail formats. A minority of stores – 24.7% of tobacco-and-liquor stores to be exact – however managed to grow by diversifying into new categories and adopting “instant retail” models—online-to-offline platforms that promise delivery within an hour.
By contrast, e-commerce was the clear winner, with an ACI of 61.89. Online alcohol sales in China have surged as producers establish flagship stores on platforms like JD.com, Tmall, and Douyin (the Chinese version of TikTok). Livestreaming sessions, often hosted by influencers or celebrities, have become a popular way to promote new wines and spirits to younger consumers.
Instant delivery services, which allow customers to order bottles via apps like Meituan and Ele.me, are also gaining traction, particularly in major cities where convenience is paramount.
Wine’s Uneven Recovery
Wine remains the weakest segment overall, with an ACI of just 40.38, reflecting the sector’s deep slump in recent years. Official data show both imports and revenues of China’s major listed wine companies declined in the first half of 2025.
Yet wine’s performance varies sharply by channel. Online, it scored 60.46, suggesting steady consumer demand from individual buyers. Offline, particularly in tobacco-and-liquor stores tied to the banquet economy, it plunged to just 31.00.
“The figures match what we see in public reports and import data—all point to a sluggish wine industry,” said Wang Zuming, deputy secretary general of the association, in an interview with Vino Joy News.
Shift Toward Lower-Alcohol Drinks
Another trend reshaping the market is the shift toward lower-alcohol products. Beverages above 50 percent alcohol content performed the worst, with an ACI of just 41.26. By contrast, drinks under 10 percent ABV—mainly beer—scored highest at 59.22.
Craft beer was a standout across all channels, with an ACI of 67.80. Drinks in the 10–20 percent range, including wine and some “new-style” beverages targeting younger consumers, scored 49.89, signalling mild contraction. Meanwhile, products between 20 and 40 percent, such as lighter baijiu and fruit-based spirits, edged into positive territory at 51.20.
New-style alcoholic drinks—often flavoured, attractively packaged, and with alcohol levels around 20 percent—are booming. They cater to younger Chinese consumers seeking a “light buzz” rather than heavy drinking and are increasingly embraced by established distillers as a growth category.
For wine to thrive, industry observers argue, it must break free from its reliance on the banquet economy and reposition itself as a drink of personal enjoyment and lifestyle. That will require building stronger brand recognition and educating consumers on regional and varietal differences.
If successful, wine could tap into China’s accelerating “low-alcohol” trend—aligning itself with a generation of drinkers more interested in casual self-indulgence than in signalling status at formal dinners.
