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Apr 23, 2014

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Soybeans with a buzz

Japanese brewers replace malt with soybeans, peas

Mar 3, 2005 - They look like beer, they smell like beer and they taste, well, not entirely unlike beer. But they're made from peas or soybeans and, perhaps most importantly, they're cheap. Japanese brewers Asahi and Kirin are on the verge of jumping into a market that Sapporo has had almost entirely to itself.

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Like happoshu before them, these so-called third-category beers take advantage of a preferential tax rate to deliver beerlike flavor without the price tag of a regular lager.

The emergence of the new drinks owes much to the drop in demand for happoshu - the low-malt beer that was the brewers' first attempt to circumvent Japan's alcohol taxes - when its price went up after a 2003 tax hike.

Third-category drinks take advantage of a new way round Japan's alcohol taxes, and are selling so well that all the big brewers have had to enter a market created last year with the launch of Sapporo's Draft One - a beerlike drink made from peas, rather than the malt and hops used in normal beer.

In its first year on the market, Draft One sold 18.15 million cases, thanks mainly to its low price. A 350-milliliter can of the brew sells for a recommended price of 131 yen, compared to about 208 yen for a same-sized can of ordinary lager.

The average beer is taxed 78 yen (not including consumption tax). By virtue of using different ingredients, Draft One falls into a different category and is taxed at a lower rate - 24.2 yen per can.

In April, Asahi will launch Shin-Nama while Kirin will offer Nodogoshi Nama. Both drinks are made from soybeans and will sell for the same price as the Sapporo product. Asahi predicts the total market for such drinks will rise from 25 million cases to 50 million to 70 million cases this year, and aims to sell 22 million cases of Shin-Nama. Kirin broadly agrees on the size of the market, and is hoping to sell 19.7 million cases of its product. Sapporo is targeting sales of 22 million cases.


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