The category had enjoyed a slight rebound following the lifting of the country's zero-Covid policy but began to falter in March.

According to the survey, 51.3% of those surveyed experienced slower sales and higher inventories in the first half of the year, 48% said their inventory pressures had increased and 36% said that they are spending more money to buy stock than sell it.

About half of Baijiu dealers surveyed said they were cautiously optimistic about the second half of the year, while more than a third said it was necessary to be wary.

The IWSR forecasts the domestic baijiu category to pass $200 billion by 2024 but the category is a difficult one to predict with producers notoriously secretive when it comes to providing data.