Competition is starting to warm up in the Beijing beer market as the dominant, but reportedly cash-strapped, Yanjing (they control 85% of the Beijing market) and their arch rival Tsingtao are in the process of being surrounded by two beer producing giants: Snow (backed by China Resources) and Budweiser. The recent completion of Snow's new RMB 600 million factory in neighboring Hebei's Sanhe City, which is capable of producing 600,000 kilo liters of beer per year, was swiftly followed by Budweiser's announcement of a RMB 350 million investment in nearby Tangshan. Executives from both companies are openly stating that they're making a move on the lucrative North Eastern China market that’s centered on Beijing.

Tsingtao, who have been trying to make inroads into the Beijing market for a long time now, are also trying to take advantage of an Olympic spike and increase their market presence before the big beer groups arrive. They're working on a "Taste of Beijing" beer developing a more "Beijing style" approach and have invested RMB 20 million in setting up a large "Beer Culture Area" in Chaoyang Park during the Olympics.

Hopefully all the competition, which consumers will recognize by the presence of Hapi (Harbin Beer – owned by Budweiser) and a new Snow product called "Snow Beishuang" in stores, will put pressure on Yanjing to, despite the rise in the price of raw materials, stop raising their prices.

Links and Sources
The Beijing News: 啤酒三巨头“围攻”北京市场
China Economic Net: Domestic and foreign beer brands escalating competition
Research and Markets: China Beer Market Report, 2006-2007
BBC: SABMiller buys China beer firms
Reuters: China brewer Yanjing to raise prices, move upstream
that's Beijing: City Scene: Selling Yanjing to the Yanks
Danwei: China's battle of the beers
China Daily: Strong brew
Beijing 2008: Yanjing Beer Announced Sponsor of Beijing 2008 Olympic Games (photo attached)
China Daily: 'No trouble brewing,' beer industry insists
Sohu: 雪花啤酒产品介绍 (Snow Product Range)
United Nations of Beer: David Friesen reviews Chinese Snow Beer
CNBC: Snow to become World's No. 2 Brand