JAPAN – Suntory Holdings Limited, a Japanese multinational brewing, and distilling company group, plans to invest 10 billion yen (US$76m) in renovating two distilleries, Hakushu and Yamazaki, which is marking its 100th anniversary.
The goal of the renovations, which are scheduled to be completed by autumn 2023, is to improve quality, including restarting in-house yeast cultivation and adding experience-based facilities, such as a tasting counter.
According to Reuters, Suntory president Nobuhiro Torii said that the company will strive to continue its success for the next 100 years, as interest in Japanese whiskey grows globally.
However, due to the aging process required in whiskey production, Suntory said that it is challenging to increase production volumes of these products, to meet the likely increase in demand.
To commemorate the 100th anniversary, Suntory has released a range of premium highballs, made with only Hakushu and Yamazaki brand whiskeys, along with carbonated water available for sale.
A 350ml can of Hakushu is to be sold for 600 yen from June, which is triple the price of its standard highball offering while a premium Yamazaki highball can, will be introduced in the same price range this coming autumn.
The investment come at a time when the executive of the company is looking to snap up high-end tequila and mescal brands to meet surging US demand for premium spirits at a time when lower-income consumers are drinking less.
“A polarization is happening in the US market: one is toward the premium; the other one is less alcohol drinking,” Takeshi Niinami, Suntory’s chief executive, told the Financial Times.
“Standard” brands were finding consumers “getting more cautious about buying one more bottle, one more glass,” he said, but he predicted continued growth in more expensive brands.
Niinami did not think Suntory will take another huge risk again soon, like that of the acquisition of Jim Beam for $16bn almost nine years ago.
Nevertheless, he said it hoped to fill gaps in its US portfolio by finding “ultra-premium” brands beyond its current line-up, which includes Sauza tequila, Courvoisier brandy, and Roku gin.
Niinami noted that the Japanese company wanted to buy some brands in the categories like mescal and tequila while investing further in existing operations in Kentucky and Mexico.
Cash generated by its US businesses would fund such investments, he said, noting the yen’s weakness against the dollar.