A growing number of young Chinese are becoming more inquisitive about craft beer, and breweries from home and abroad have been quick to jump into the fray to catch the rising waves of interest

New craft beer entrant World of Beer will have to fend off competition from rivals such as Shanghai Brewery and it could do so with its extensive selection from around the world. PHOTOS PROVIDED TO CHINA DAILY

While China's beer market has been shrinking, it seems consumers' appetite for a particular type of brew has actually been growing.

China's national statistics bureau announced last month that the country produced 22.51 million tons of beer in the first half of 2016, down 8.36 percent year on year. As of June, the domestic beer industry had experienced a slowdown for 24 consecutive months.

In contrast, the craft beer sector has been experiencing robust growth, with the amount of imported craft brews soaring by almost five times over the past three years.

In June, award-winning American craft beer brand Goose Island was officially introduced to China via Anheuser-Busch Inbev, the parent company which acquired the Chicago-based brewery in 2011. Just a month later, another American craft beer shop and restaurant, World of Beer, made its foray into the Chinese market, opening its first overseas outlet along the bustling Fumin Road bar stretch in Shanghai.

"The craft beer drinkers in Shanghai have reached such a sophisticated level that they can tell us tips like how a Russian Imperial Stout should be kept out of refrigerators in order to maintain its rich flavor," said Yin Cong, market development partner with World of Beer and the CEO of World of Beer China.

The 31-year-old Sichuan native said he was once "addicted" to the beers in a World of Beer store which was on the way to his former workplace, an IT-finance company in Tampa, Florida. In 2014, Yin decided to become more than just a loyal customer of the store — he was going to introduce this concept to his own country.

"The craft beer scene has just started to emerge in China, and the number of craft beer enthusiasts has been increasing quickly. Because of this enthusiasm, and World of Beer's proven and successful model, we knew that this concept would be a perfect fit," said Yin.

Founded in 2007 by two close friends, World of Beer started as a humble neighborhood bar with an unusually extensive selection of craft beer. It has since become recognized as one of the most reputable curators of craft beer in the market and now has more than a hundred franchises in the United States.

The Shanghai franchise of World of Beer officially unveiled its extensive offerings during its grand opening on August 18. Inside the spacious outlet, some 400 types of bottled craft beer from all over the world filled massive six-door coolers, with another 41 beers also available on tap.

While more than half of the offerings are from established brands or breweries around the world, the Shanghai outlet also sells craft beers from small independent breweries as well as up-and-coming local brands such as Nanjing-based Master Gao, one of the earliest craft beer brewers in China. Gao Yan, the founder of Master Gao, estimated that there are upwards of 60 craft beer breweries in China today.

"The oversupply of industrialized beer in China has led the central government to adopt a rather strict policy about allowing craft beer breweries to operate. However, the number of brewers, especially in big cities, are still growing quickly," said Yin, who also conceded that the general quality of craft beer in China is still not quite up to scratch.

Yin also noted that the company is planning to open another three taverns in China by 2018. The second store will also be in Shanghai.

"Shanghai is like the test bed for food and beverage businesses. If you don't succeed here, you are not likely to make it elsewhere in China," said Yin.

Competition looks to be stiff for this new craft beer entrant as there are already a number of popular craft beer joints in the city, such as Boxing Cat Brewery, Shanghai Brewery, Dr Beer, Daga Brewpub and Jackie's Beer Nest. There is even a local grocery store operated by a middle-aged Shanghai woman who boasts a selection of 200 types of bottled beer.

However, Yin is confident that the market is large enough to sustain additional competition, and that World of Beer is poised to tap into the rising interest levels of craft beer in Shanghai. In addition, there has also been growing interest among young Chinese craft beer lovers in brewing their own beers.

Li Wei, president of the Beijing Home Brewing Society, estimated that more than 20 provinces and cities in China now have their own communities for home brewing aficionados, with the population of such people numbering around 10,000 people, about one-sixth of that in the US.

"The way young Chinese enjoy beer today is very different from their parents' generation. The former prefers to sip, the latter prefers to chug," said Yin.

London-based market research firm Euromonitor estimated that China's high-end beer market, which is mainly dominated by craft beer, expanded by 20 percent in 2015 but has yet to gain a market share of more than 2 percent.

In general, average beer consumption in China is 34.2 liter per capita per year, slightly higher than the world average of 33 liters. It is believed that over the next few years, Chinese consumers will not only drink more beer, but also gravitate toward the more refined and expensive options. By 2017, China is likely to overtake the US as the world largest consumer of beer, according to Euromonitor.