(Bloomberg) -- When Uno Jang was growing up in South Korea, his go-to drink was the soju bomb—a shot glass of soju dropped into a large beer mug and then chugged. 

Now, as creative director at Jigger & Pony in Singapore (No. 14 on the World’s 50 Best Bars list), Jang has updated his old standby. The Korean Boilermaker is made by mixing hop-infused craft soju with carbonated mineral water, a splash of rye whiskey, pear eau de vie and passion fruit syrup. The cocktail is served with an L-shaped cocktail stir that raises and lowers a large, rectangular ice cube to produce the frothy head of a freshly drawn beer. It’s one of the most popular drinks on Jigger & Pony’s menu.

Soju is experiencing surging demand at top bars and restaurants around the world. The oft-maligned Korean spirit is typically derived from fermented rice but can be made from such other grains as wheat, barley and corn—or starches like sweet potato—with an average ABV of 20%. Unlike the most available brands, which have a neutral, grain alcohol taste, finely-crafted sojus often show savory notes like those of mushroom and hazelnut.

The spirit is best known for the artificially flavored, sweetened versions invariably produced by South Korea’s largest soju producer, Jinro, whose green bottles litter many a late-night karaoke room. Jinro doesn’t just dominate the soju market, it’s the world’s top liquor brand. Parent HiteJinro Co. took in approximately $1.13 billion in revenue from soju in 2022. That year, Jinro became the first liquor brand to sell more than 100 million cases, up from 65.3 million a decade ago.  

Jinro’s dominance resulted from decades of austerity in rice production and distribution that made it difficult to produce quality soju. In 1965, South Korea’s government banned the use of rice in alcohol production in response to widespread famine following the Korean War. The regulatory hurdle came as a blessing in disguise for large companies such as Jinro and Lotte Corp., leading them to mass-produce the spirit with ethanol-based distillates made from cheap commodity starches like tapioca and sweet potato. The move away from traditional, small-batch products spurred creation of a commoditized soju for mass consumption. 

Now, craft distilleries such as Tokki, whose Black Label soju features in Jang’s boilermaker, are reaping the rewards of increased cocktail bar demand by returning to more artisanal production methods and ingredients such as rice and nuruk—the traditional Korean fermentation starter used for alcohol—to produce higher-quality spirit.

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“The influence of K-pop and K-culture amplifies interest in Korean products like soju,” says Jang. “It attracts a more global audience eager to explore all facets of Korean lifestyle.” The skyrocketing popularity of Korean cuisine, from kimchi to barbecue to fried chicken, has also created a halo effect for Korean spirits. 

Tokki Soju was founded in Brooklyn, New York, in 2014 by Brandon Hill, who with Chief Executive Officer Douglas Park moved operations to Chungju, Korea, in 2020. The company has enjoyed a 90% compound annual growth rate over the past seven years and in one year nearly doubled its production, from 29,000 cases in 2022 to 54,000 cases in 2023. It sells 375 ml and 750 ml bottles for prices that range from about $25 to $60. 

Its products feature at seven of the World’s 50 Best Bars, including New York’s Double Chicken Please (No. 2) and Overstory (No. 17) and at Argo in Hong Kong (No. 34). Coqodaq, Manhattan’s new Korean fried chicken hotspot, features Tokki Black Label in the Amondeu, a soju-accented riff on the traditionally gin-based Army & Navy. 

“Different sojus can be used flexibly as either neutral lower-ABV spirits or higher-proof grain-forward spirits that truly stand out in cocktails,” says Sondre Kasin, principal bartender of Coqodaq’s parent company, Gracious Hospitality.

As former bartenders, Tokki’s Hill and Park see value in promoting their brand at high-profile cocktail venues. “Our strategy has always been to target the top-tiered restaurants and bars,” says Park.

An additional label winning attention in the US is a collaboration between Brooklyn’s Hana Makgeolli, which makes premium-quality fermented rice wine, and Matchbook Distilling Co. in Greenport, New York. Hana Soju 60 ($60 for 375 ml) is made with nuruk and distilled at 60% ABV—more than triple that of most green-bottle sojus—bringing out the spirit’s bright, floral character. Released in December, it’s served at top Korean restaurants, including New York’s Atomix and Baroo in Los Angeles. Alice Jun, Hana Makgeolli’s co-founder, says she plans to expand brewing capacity in the spring and to begin exporting by yearend.

Boutique importers are meeting demand from restaurant and cocktail bars by bringing more craft soju from Korea. KMS Imports, a New York-based outfit that has specialized in small-batch soju since it was established in 2020, has doubled its number of producers to build a portfolio of 20 distinct craft products in less than four years—impressive growth, given that demand among Americans was long confined to a niche. After founder Kyungmoon Kim began importing Won Soju, a brand founded by K-pop artist Jay Park in 2022, his company doubled its annual revenue.

“The $3 billion soju market globally is not real soju,” says Hana Makgeolli’s Jun. “Soju as a spirit, as a craft, has the depth to compete against Japanese craft spirits, whiskey, tequila or so many different types of spirit categories from all around the world.” 

Hwasim Jujo, an up-and-coming distillery located about an hour outside Seoul, is collaborating with Zest (at No. 18, Korea’s highest-ranked bar on the World’s Best list) to develop a private-label soju that incorporates the bar’s zero-waste philosophy: Spent garnishes such as rosemary sprigs are used in production. Noah Kwon, Zest’s co-founder, says the team plans to debut a sustainable milk-washed cocktail with Hwasim’s smoked rice soju; “Almost 70%” will be flavored with repurposed fish bones, green tea and vinegar.

For its part, Tokki has been broadening its portfolio of artisanal sojus to include higher-end expressions. Among them is a premium soju finished  in Pedro Jiménez sherry casks and priced at $60, more than twice that of Tokki’s entry-level White Label soju. 

The company believes the biggest growth opportunity for craft soju lies in major cities where cocktail culture is flourishing. “We want it to get to a point where you don’t even think of it as Korean anymore,” says Tokki’s Hill. “When you think of vodka, you don’t think ‘Eastern European’ anymore. That’s just something that’s at a bar.” 

(Corrects name ofTokki CEO Douglas Park in 8th and 11th paragraphs)

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