JAPAN – Asahi Group Holdings, a prominent Japanese beverage holding company, has announced a significant investment of ¥6 billion (US$37.7 million) to build a new cask warehouse at its Tochigi plant.  

This initiative is part of Asahi’s broader strategy to increase storage capacity for its renowned Japanese whisky brand, Nikka, to meet growing domestic and international demand. 

The new facility, expected to be operational by September, will have the capacity to store “tens of thousands” of casks, significantly enhancing Nikka’s storage capabilities. 

Asahi is also in the early planning stages for additional warehouse structures at its Yoichi and Miyagikyo distilleries, with operations at these sites expected to commence within the next few years. 

“Asahi Group is committed to expanding our physical storage and securing sufficient casks for ageing,” a company spokesperson said. “With the new warehouse at the Tochigi Plant, we anticipate a 10% increase in Nikka whisky’s overall storage capacity compared to 2021 levels.” 

This investment follows a previous ¥12.5 billion (US$78.4M)expenditure on production expansion between 2015 and 2021, which included enhancements to storage facilities at Yoichi and Miyagikyo.  

Asahi’s efforts are driven by a strategic goal to bolster Nikka’s presence in the global whisky market, particularly in the mid-to-high price range segment. 

Currently, around 90 percent of Nikka whisky sales occur in the domestic market, with the United States being the largest export destination. The brand is available in 59 markets worldwide, and Asahi aims to expand this to 65 markets by 2025. 

In 2023, Nikka whisky sales totaled ¥53.4 billion (US$335.04M), a 15 percent increase from the previous year. The group forecasts sales growth of 4 percent in 2024, projecting total sales of ¥55.5 billion (US$348.22M).  

“To enhance Nikka whisky’s presence as a premium brand globally, we are intensifying our initiatives, primarily in the US and Europe,” Asahi stated. 

Recently, Asahi appointed Kirsch Import to handle Nikka whisky distribution in Germany.  

Additionally, Amsterdam-based Monarq will begin distributing Nikka in the Caribbean for the first time. Kirsch Import, which also manages brands like Ballantine’s Scotch and Black Velvet Canadian whisky, has taken over distribution rights from Stock Spirits’ Borco. 

In the first quarter of 2024, the company reported a 5.1 percent year-on-year revenue growth, driven by strategic price adjustments and a focus on premiumization.  

Core operating profit also saw an 8.4 percent year-on-year increase, primarily due to higher sales volumes and an improved product mix in Japan and Europe. 

Liked this article? Subscribe to Food Business Africa News, our regular email newsletters with the latest news insights from Africa and the World’s food and agro industryHERE