How Taiwan Stores $400 Million Worth of Its Most Consumed Liquor in Abandoned Underground Military Facilities

(Photo: Kinmen Kaoliang)

In an abandoned military complex 200 km off the coast of mainland Taiwan, the nation’s most popular alcohol is produced, stored and shipped from massive underground bunkers.

The distillery belongs to Kinmen Kaoliang, a state-owned liquor firm that specializes in baijiu. The spirit — typically made from fermented sorghum, a type of ancient grain — holds international sway like no other.

Though baijiu isn’t particularly well known in the West, it’s by far the best-selling spirit type in the world, surpassed in the alcohol category only by beer, wine and liqueurs. Baijiu reached a global market size of $95.21 billion in 2022, more than whiskey ($64 billion) and vodka ($25 billion) combined.

Within Taiwan, Kinmen Kaoliang is uniquely synonymous with the spirit. The country consumes an estimated 45,000 liters of its product every day, equivalent to over 80% of all spirits consumed in Taiwan. This is especially impressive given that Kinmen’s flagship product is bottled at a blistering 58% ABV (nearly 120-proof).

So how did the company end up on a military base?

In a recently released documentary, filmmakers traveled behind the scenes on Kinmen Islands, home of the eponymous distillery. Located a mere 2 km off the southeast coast of China, the islands became a key battleground throughout the Chinese Civil War and the Second Taiwan Strait Crisis. Today, it is the closest Taiwanese-claimed territory to mainland China.

Kinmen Islands, pictured in pink. Taiwan pictured in yellow. (Photo: Wikimedia Commons)

Amidst wartime, military leaders devised a plan to repurpose the island’s agriculture.

“During the military administration 70 years ago, Kinmen wasn’t very prosperous and there wasn’t much in the way of farm crops,” says distillery general manager Chengkang Ding.

“The commander at the time, General Hu Lian, understood this. So he founded the Jiulong River Distillery to encourage the farmers to grow sorghum. The idea was they would use sorghum to make alcohol and trade that for rice.”

The transparent, delicately sweet spirit was a hit, evolving over the decades into a monolithic cultural icon. Between 2008 and 2022, the company even had its own basketball team (it finished fourth in its final championship playoff).

In the documentary, an employee is seen exploring the facility’s repurposed tunnels, filled with cellar upon cellar of stainless steel tanks. According to the narrator, over 3.5 million liters of liquor are contained in these passages — equivalent to around US $400 million.

“Each tankful has its own character and flavor. The flavors include sour, sweet, bitter, tart and salty, so it’s important that we use them to complement each other. We do not add any artificial flavoring or fragrance,” says cellar controller Fuguan Hong.

“We take care of them diligently just as if they were our own children.”

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