U.S. wine industry toasts decline in Japan’s sake sales

Dec 23, 2014

(McClatchyDC) - Standing next to the wine display at the Nissin World Delicatessen in Tokyo, Masahiro Ino eyed a $99 bottle of Silver Oak cabernet sauvignon imported from California.

“I do prefer wine over sake,” said Ino, 24. “Wine is becoming very trendy. It’s becoming mainstream nowadays.”

With more younger consumers rejecting the alcoholic drink of their ancestors, sake sales have steadily tanked in Japan, another victim of globalization. Forty years ago, Japan had 4,000 sake breweries, but only 1,500 remain.

“I feel sad, a little sad,” said Shunsuke Kohiyama, export adviser for the Japan Sake and Shochu Makers Association. “But is there anyone who wears Japanese clothing? Everybody wears Western clothing. Rarely there’s a kimono.”

For the U.S. wine industry, the sake decline is a reason to raise a glass, especially California growers, who provided 90 percent of the nation’s exported wine in 2013, amid a year of record sales in foreign countries.

“If you’re in Napa and you need to sell high-end wine, you need to feed the fish where the fish can jump, right?” said Russell Weis, the general manager of Silverado Vineyards in Napa, Calif. “And that makes Japan extremely interesting.”

Wine consumption in Japan is still relatively low, accounting for only 3 percent of alcoholic-beverage sales. Beer is by far the top seller, but the vulnerability of sake has made the wine market extremely competitive, with 50 countries exporting wine to Japan.

France, long the top supplier, controls nearly a third of the wine market, but its share has slipped as more countries enter the fray.

“The Japanese love to drink,” said Bill Campbell, the owner and chief executive officer of Hotei Wines, a top Tokyo importer of California wine. “People are drinking more wine in general, and they’re less fixated on France and more willing to try the rest of the world. And the old people who drank sake are dying, and the young people are drinking wine.”

Weis said Silverado expected to sell 500 cases of wine in Japan this year, a 25 percent increase from 2013. Each case, the majority of them 12-packs, sells for an average of $300.

Weis said a sputtering economy had forced Japanese restaurants to experiment with new products and that a “psychological barrier” had fallen in the past decade as more of them began including U.S. wine on their menus.

“Now you find California wines in Japanese restaurants and Italian restaurants and international restaurants and even – God forbid – French restaurants,” he said. “So there’s just been a real spirit of openness. . . . They’re trying all kinds of new concepts and ideas, and we are the beneficiary.”

Campbell, who grew up in Sonoma County, said he spent two to three months a year in California, visiting vineyards and trying to find wines that would sell in Japan. He and his team taste more than 1,000 wines each year.

“People always want something cheap and cheerful,” Campbell said. “And beyond that, people want something either really delicious, really interesting or really rare. There’s a cult wine market here. . . . I taste, I taste and I taste and then taste some more, then taste again.”


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