Japan subsidies give boost to brewers feeling pandemic pinch

Japanese makers of alcoholic beverages are using government subsidies to develop new products, in a bid to stem a decline in consumption amid the coronavirus crisis.

Japanese sake that pairs well with foreign cuisine and custom-made drinks to meet demand for consumption at home are expected to hit the shelves soon thanks to the initiative.

According to a survey by the internal affairs ministry, the average spending per household with at least two people on alcoholic drinks at home rose from ¥41,000 in 2019 to ¥46,000 in 2020, while the figure for drinks at restaurants and bars plunged from ¥20,000 to ¥9,000.

In a bid to boost consumption, the National Tax Agency established the so-called frontier subsidy in which the government covers half the costs for developing new products and establishing new sales routes, to a maximum of ¥5 million.

The government earmarked a total of ¥1.4 billion for the subsidy in the supplementary budgets for fiscal 2020 and 2021.

Sake brewer Tsukasabotan Shuzo, based in the town of Sakawa in Kochi Prefecture, is creating a sake using yeast developed by the Kochi Prefectural Industrial Technology Center.

“We can make sake that matches well with hors d’oeuvres using fruit” thanks to the strong apple- and pear-like aroma of the yeast, company President Akihiko Takemura said.

The company purchased a special bottling machine to produce sparkling sake with a refreshing taste. Development of the drink is expected to be completed around February.

“We had second thoughts about buying new machinery amid the coronavirus crisis, so we’re thankful for the subsidy,” Takemura said. “We hope that people in overseas restaurants make a toast using our sake before eating hors d’oeuvres using fruit from Kochi.”

A representative of sake brewer Ishii Shuzo in Satte in Saitama Prefecture said that “large-scale demand from parties and ceremonies such as marriages and funerals plunged all at once due to the coronavirus pandemic.”

The company has begun creating custom-made sake, allowing people to select their preferred type of rice and level of milling, in the hope that creating small lots of diverse types of sake is their path for survival.

Ishii Shuzo used the frontier subsidy to purchase a sake-making machine that can handle small lots, and hopes to complete its production line and begin accepting orders from spring.

The custom-made sake is aimed at individual consumers who are fans of sake and eateries that want to serve original drinks.

Shakotan Spirit Co., which produces and sells gin made from ingredients grown in the town of Shakotan in Hokkaido used the subsidy to buy an additional distillation tank to start custom-made gin production in summer last year. It has accepted orders from groups and companies, allowing them to select their preferred combinations of plants to use.

The company plans to hold events in which individual customers can freely blend ingredients of their choice in the future.

“How we incorporate aroma from local vegetation will be a factor in our efforts to differentiate us from competitors,” a company representative said.