Japanese liquor giant Suntory will raise prices on major alcoholic beverages, including premium whisky, imported soju, and wine, by up to 20% starting in April next year. The Japanese premium whisky "Hakushu 25 Years," which Nvidia Chief Executive Jensen Huang gifted to Samsung Electronics Chairman Lee Jae-yong, Hyundai Motor Group Chairman Chung Eui-sun, and SK Group Chairman Chey Tae-won, drawing attention, is also subject to the price increase. Following Suntory's price hike announcement, not only Quick-Turn day-trippers but also domestic duty-free distribution networks are staying on alert.
According to the retail industry on the 17th, starting with shipments on April 1 next year, Suntory will raise prices by up to 15% on 15 products across three premium whisky brands—Hibiki, Yamazaki, and Hakushu. "Hibiki Japanese Harmony (700 ml)" will rise about 6%, from 8,250 yen (about 77,000 won) to 8,800 yen (about 82,800 won), and the premium line "Hibiki 30 Years" will increase by around 15%, from 396,000 yen (about 3.73 million won) to 456,000 yen (about 4.29 million won).
Prices for about 40 Suntory imported products, including Korean soju "Kyogetsu Green (Green)" and Seoul Makgeolli, as well as 132 wines, are also set to rise. The rate of increase will range from 2% to 20% depending on the item.
Suntory said of the decision to raise prices, "It has become difficult for corporations to absorb all the expense increases, including packaging materials and purchase prices," adding it is an "inevitable price adjustment to stably supply high-quality products."
Earlier, on Apr. 2024, Suntory raised prices for major brands such as Hakushu and Yamazaki. With the popularity of Japanese whisky rising overseas and the nature of whisky brewing requiring long aging, supply shortages have overlapped, sustaining upward price pressure. According to Japan's National Tax Agency statistics, exports of Japanese whisky reached 50.1 billion yen as of Mar. 2023, more than 12 times higher over 10 years.
Korea is one of the major consumer markets for Japanese whisky. With the rise in popularity of the "highball" centered on the MZ generation (born from the late 1980s to the early 2000s), demand for Japanese whisky has surged, and the number of Quick-Turn travelers making short trips to Japan solely to buy whisky has increased. Using duty-free benefits, it was often cheaper than domestic purchases even after including airfare and ferry expenses.
However, after April next year, there is a possibility that Quick-Turn travelers' activity will decline for a while. A liquor industry official said, "To sell at higher prices after April, local wholesalers may release fewer quantities into the market in the near term," adding, "Following Suntory's price hike, there is also a possibility that other whisky brands such as Nikka will raise prices, so Quick-Turn travelers will keep a close watch on the situation."
The domestic duty-free industry is also expected to face pressure to adjust prices for alcoholic beverages such as Japanese whisky. Duty-free prices are influenced by various factors, including manufacturers' and importers' costs, exchange rates, and distribution inventories, and higher ex-factory prices from the Japanese headquarters serve as a background condition that increases the likelihood of duty-free price adjustments.
An official at a duty-free company said, "If local ex-factory prices for main lineups such as Hibiki, Yamazaki, and Hakushu rise, a certain portion will inevitably be reflected domestically," adding, "Because these are brands with scarcity, price sensitivity is not high, but from a price competitiveness standpoint, we may partially adjust the duty-free liquor category." Another official said, "Since not only whisky but also soju and wine are subject to increases, we cannot rule out the possibility that overall prices in the duty-free liquor category will rise."
Myung Wook, an adjunct professor in the Department of Barista & Sommelier at Sejong Cyber University, said, "Whisky is a product with high scarcity and collection value. Until right before the price increase takes effect, pre-purchase demand considering its scarcity value will grow," adding, "Depending on the impact of Suntory's roughly 20% price increase, other major brands such as Nikka are also likely to adjust their business plans and join the trend of price hikes."