Cheaper brews await Japanese beer fans

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Japanese brewers are launching a range of new beers that tap into a growing taste for "third-category" beers, which are conveniently cheaper than conventional beers because they get around government tax laws by containing no malt.

Kirin plans to launch a new brew, called 1000, that uses hard water and contains elevated amounts of calcium and magnesium to give it a distinctive flavor.

Asahi Breweries is to release Strong Off, which has a relatively high alcohol content of 7 percent and 60 percent less carbohydrates, whilst Suntory is using seven different types of hops into its new Relax beer-like drink.

Sales of third-category beer - which is formally categorized as a "beer-like alcoholic drink" - have been rising since their introduction five years ago, thanks largely to a Y28 (€0.22) tax rate on a 350 milliliter can, as opposed to a Y77 (€0.60) tax on regular beer, which has more than 66.7 percent malt content.

Japan's four largest brewers have had a torrid couple of years and sales fell for the fifth straight year in 2009, sinking 2.1 percent to 472.5 million cases. But while overall sales were down, third-category beers are accounting for an increasing amount of the total.

In 2010, sales of third category beers are predicted to account for fully 30 percent of total sales.

"This sector of the beer market has increased rapidly in the last year and other companies are releasing new products to try to tap into the market, but our Nodogoshi-nama is the leader with 40 percent of the market," Nahoko Abe, a spokeswoman for Kirin Brewery Co., told Relaxnews.

And at around Y130 (€1.01) for a 350 ml can, it is substantially cheaper than regular beer, which retails for Y210 (€1.63).

Kirin's drink has no malt but makes use of soy protein in the production process. Japan's other large brewers have released similar tax-defying drinks, with Sapporo Breweries' Draft One and Slims variants using pea protein while the Suntory Holdings' Jokki-Nama involves corn in the brewing process.

And with regular beer sales sliding, brewers are focusing more efforts on developing new tastes in this sector.

JR

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