China’s Economy Rapidly Declining, Consumer Spending Downgrade
China’s leading liquor company, Kweichow Moutai, is experiencing a significant downturn in performance as the country’s economy rapidly declines and residents cut back on consumption. Over the past four years, the price of Moutai has been cut in half, with some distributors revealing losses of hundreds of thousands of yuan this year.
On October 31st, the Zhejiang Radio and Television Group’s multimedia news center, “China Blue News,” reported that Mr. Wu, a Moutai distributor in Hangzhou with 20 years of experience, disclosed that he had lost at least 300,000 yuan since the Chinese New Year despite holding inventory worth three to four million yuan. He remembered that by the end of 2021, the price of a single bottle of Moutai had reached as high as 3250 yuan.
According to the wholesale reference prices disclosed by the third-party platform “Today’s Liquor Prices,” on October 28th, the price of a 25-year-old Flying Moutai single bottle dropped by 25 yuan to 1690 yuan per bottle, while the price of a box of 25-year-old Flying Moutai dropped by 20 yuan to 1715 yuan per bottle compared to the previous day. This marked the first time the wholesale price of Flying Moutai had fallen below the 1700 yuan mark, setting a new historical low. The price of a 24-year-old Flying Moutai box dropped by 20 yuan to 1780 yuan per bottle.
In the following days, the price of Moutai continued to decline. By October 31st, the price of a 25-year-old single bottle of Flying Moutai dropped by another 20 yuan to 1640 yuan, while the price of a 25-year-old box dropped by 15 yuan to 1675 yuan, and the 24-year-old box remained unchanged at 1750 yuan.
Comparing the prices to those in 2021, the price of Flying Moutai has been halved. On September 21st of that year, a box of Flying Moutai had sold for 3860 yuan per bottle.
On October 31st, the topics “Flying Moutai’s nearly 50% price drop in 4 years” and “Recycler claims losses of hundreds of thousands this year” sparked online attention.
Real estate blogger “Cai Xiao Ye” remarked, “The peak price of Moutai also occurred at the end of 2021, which should have been roughly in sync with the real estate market, and then began to decline.”
The headline article author “Captain Plus” also noted, “In recent years, the Moutai market has been closely following the real estate market, reaching its peak in 2021 and continuously declining since then. Those who hoarded Moutai like they invested in real estate, anyone who bought at the peak basically made losses.”
Independent financial commentator and writer Guo Shiliang posted on Weibo, “The wholesale price of Moutai continues to decline, with the prices of single and boxed bottles dropping below 1800 yuan. Some are even falling below 1700 yuan, leaving just around 200 yuan of space away from the official guidance price of 1499 yuan. If the price of Moutai continues to plunge and nears the official guidance price, it may lead to widespread losses for recycler and distributor. Currently, there is no sign of Moutai prices stabilizing.”