Farewell to the 1499 yuan era! The retail price of Feitian Maotai has increased, kicking off a "market-driven" mode. Can this open up new price space?

Ask AI · How will a “follow-the-market” model affect distributors’ pricing power?

China Economic Daily Reporter: Xiong Janan    China Economic Daily Editor: Zhao Yun

On the evening of March 30, Kweichow Moutai released a major matters announcement. Starting from March 31, 2026, the sales contract price (ex-factory price) of Feitian 53%vol 500ml Kweichow Moutai Liquor (2026) will be adjusted from 1,169 yuan per bottle to 1,269 yuan per bottle, and the retail price in its self-operated system will be adjusted from 1,499 yuan per bottle to 1,539 yuan per bottle. It has been only a little over two and a half years since the ex-factory price was last raised to 1,169 yuan per bottle.

The reporter from China Economic Daily’s “Let’s Get It Done” section noticed that from 2022 to 2024, the company’s actual production capacity has remained stable at 56,000 tons for three consecutive years, with virtually no increase; the market quoted price (批价) of Feitian Moutai has been falling continuously since last year. With volume unable to increase and prices under pressure, raising prices seems like a natural choice, but the increase of less than 9% is clearly more restrained compared with the previous time.

On the other hand, this announcement clearly states that the retail price of Feitian Moutai in the self-operated system has been adjusted to 1,539 yuan per bottle. From switching “iMoutai” from a guidance price to a retail price, to raising 1,499 yuan to 1,539 yuan, it not only marks the complete break with the “guidance price” of 1,499 yuan that had been in use for 8 years, but also means that the Feitian Moutai price has officially entered the “follow-the-market” phase.

Since this time no terminal prices for the distributor system were specified, does that mean distributors can also price freely? How much incremental benefit can this round of price increase bring to this year’s performance? After breaking the 1,499 yuan cap, where will market pricing go? Has the market-oriented reform that Moutai repeatedly emphasized truly taken a key step? What impact will it have on the industry?

A restrained ex-factory price increase of nearly 9%
Price adjustments at the end of the first quarter cover full-year performance
But the contribution may be limited

“By protecting the price, we can control the volume; the company’s performance is guaranteed.” When discussing Kweichow Moutai’s latest price increase, a securities analyst spoke directly.

Distilleries commonly raise prices during off-peak seasons, but Moutai chose the end of the first quarter this time. The previous price increase occurred in November 2023. At that time, the boost to that year’s performance was limited, and the real dividends were released in 2024. This time, the price increase landed right at the close of the first quarter of the year, meaning the effect of the price increase would fully cover the company’s performance for the entire year, and its positive impact on the income statement is clearly more direct.

In 2024, the first full year after the previous round of price increases, Kweichow Moutai achieved total operating revenue of 174.144 billion yuan, up 15.66%; attributable net profit of 86.228 billion yuan, up 15.38%. On top of a high base, the company has sustained double-digit growth in both revenue and net profit for the eighth consecutive year.

However, the chill in industry adjustments has not gone away. In 2025, the company lowered its growth target for total operating revenue to 9%; in the first three quarters, the actual growth rates of revenue and net profit were only 6.32% and 6.25%, respectively.

On the other hand, the market quoted price for Feitian Moutai has continued to decline since last year, while the company’s actual production capacity has remained around 56,000 tons from 2022 to 2024, with virtually no incremental production for three consecutive years. With volume unable to rise and prices under pressure, to meet the stated performance targets, it seems that the only remaining path is pricing.

That said, the contribution of this price increase to performance may be limited.

After the last round of price increases, many securities firms estimated that this single item would thicken the company’s 2024 profit by more than 4.5 billion yuan, but this time the力度 (strength) is clearly more contained.

Looking back at Moutai’s nine prior ex-factory price hikes since it went public, the increase has never been below 15%, and the per-bottle increase has ranged from 50 to 200 yuan per bottle. In this round, however, the per-bottle increase is only 100 yuan, with a rise of less than 9%. Compared with the previous round of 200 yuan per bottle and a 20% increase, this looks rather “restrained.”

The above-mentioned securities firm’s forecast was that after the price increase, it could bring about approximately 2% growth in performance.

But the logic behind price adjustments has never been only about profit. Industry analyses suggest that for manufacturers, adjusting prices is not simply about pursuing higher profit; rather, it is to make product prices more closely reflect real market conditions, so that price signals become clearer and more effective. Through a precise choice of timing for price adjustments and adjustments to a scientific profit-allocation mechanism, Moutai not only further strengthens its long-term development foundation, but also sets a benchmark for the industry currently in a period of cycle adjustment—rather than consuming itself in a price war, it is better to reshape a transparent and stable pricing system through channel reform and digital tools.

“Guidance price” becomes “retail price”
Feitian Moutai truly enters a price “follow-the-market” era

For the market, the performance elasticity from this pricing change may not be as strong as in the past, but the more important point is that it has taken a key step in Moutai’s market-oriented reform. Besides raising the ex-factory price, the company also explicitly raised the retail price in its self-operated system by 40 yuan to 1,539 yuan per bottle.

“The essence is the marketization of pricing—follow the market.” A distributor told the reporter that the ex-factory price adjustment itself is not marketization; what matters is the core change: canceling the 1,499 yuan guidance price that had been used for many years. This is the first time since 2018 that Moutai has adjusted its market guidance price.

In his view, in the past few years Moutai raised the ex-factory price multiple times, but against the market it was “nailed” at 1,499 yuan in the form of a guidance price. In January this year, when iMoutai launched Moutai liquor products, it had already changed the past “guidance price” to a “retail price,” but the Feitian Moutai price remained fixed at 1,499 yuan per bottle.

And this time, the increase in the retail price formally bids farewell to the 1,499 yuan-per-bottle price level used for 8 years. This will be a landmark move signifying Feitian Moutai’s entry into “follow-the-market.” It may also mean that its future price could be adjusted at any time based on market supply and demand.

Also worth special attention is that this company only clarified the retail price for its self-operated system and did not impose hard requirements on terminal pricing in the distributor system. This may leave distributors room to set prices freely based on market conditions.

Since it proposed its market-oriented transformation at the end of last year, one important move by Moutai has been, on the “iMoutai” platform, to clearly label the prices of all products as “retail prices.” Defining the terminal price as a “retail price” reflects Moutai’s intention to reclaim market pricing power, avoid abnormal price fluctuations, and at the same time set a reasonable profit range for channels.

Breaking the guidance price of 1,499 yuan is equivalent to opening up new pricing space for distributors. The distributor further explained that previously, it was not allowed to sell below the guidance price; now that constraint is gone, and in the future they will decide exactly how much to sell for entirely based on market demand. It also cannot be ruled out that Moutai will adjust according to market dynamics, and the company can also control volume through iMoutai to maintain price stability.

Moutai’s senior management has repeatedly emphasized the need to ensure distributors’ reasonable profits. In its announcement on January 14 this year, the company stated clearly that under the distribution model, sales contract prices will be scientifically and reasonably calculated and dynamically adjusted according to different products, different channel operating costs, operating difficulty, operating risk, service capability, and so on.

Industry analysts believe that this series of moves shows that the purpose of Moutai’s reforms is absolutely not to eliminate distributors or disrupt the existing channel system. Rather, through a more transparent pricing mechanism and dynamic adjustments, it aims to clarify the functional division of labor between the manufacturer and distributors and the allocation of profits, ultimately ensuring reasonable returns for the channel side.

Leading liquor enterprises generally “cut” prices downward
Why did Moutai choose “raise” prices against the trend?

The timing of Moutai’s price adjustment also stands out sharply compared with its peers.

Since 2025, China’s liquor industry has entered a deep-water zone where three phases overlap: “policy adjustments, consumption transformation, and competition for stock.” Channel inventories have soared, and widespread price inversion has become the industry norm. Distributors’ profits have been thin or even negative.

According to the “2025 China Baijiu Market Midterm Research Report,” in the first half of 2025, the three price bands with the most severe price inversion were, in order, 800 yuan–1,500 yuan, 500 yuan–800 yuan, and 300 yuan–500 yuan; among these, products in the 500 yuan–800 yuan band face the most difficulty. The reporter noted that the 500 yuan–800 yuan band is precisely the core battleground for mid-to-high-end baijiu, and it is also the main price band for the concentrated ex-factory price adjustments made by leading liquor enterprises.

To effectively ease channel pressure, since last year many leading liquor enterprises, such as Wuliangye, Xi Jiu (习酒), and Langjiu, have all adjusted downward the ex-factory prices of their core products, or achieved “de facto price cuts” through channel subsidies, quota adjustments, and other measures, covering multiple price bands including high-end and mid-to-high-end.

With the industry generally adjusting prices downward, Moutai chose to move upward. What logic does this decision rest on?

Industry analysts believe that unlike other liquor companies that rely on channel stock-piling to drive growth, Moutai’s production capacity has remained stable at 56,000 tons for three consecutive years with virtually no room to increase. While terminal demand may fluctuate due to the broader environment, there is still strong rigidity in core scenarios such as gifting, collecting, and banqueting. When supply cannot expand but demand still has support, raising prices is no longer a risky move, but a re-pricing of scarcity.

Liquor expert Xiao Zhuxing (肖竹青) believes that from an industry perspective, Moutai’s counter-cycle price adjustment sends a clear signal: top brands still have the ability to regulate supply and demand and optimize the price system through market-oriented methods, injecting confidence to help lead the industry out of the adjustment period.

When prices become more transparent, channels become healthier, consumption becomes more real, and development becomes more certain, the path to high-quality development for the baijiu industry will also be more stable. Moutai’s move is expected to guide the industry to shift from “cycle anxiety” toward “value deepening,” providing a reference path for the industry to emerge from this round of adjustment cycle.

China Economic Daily