Fri 28 Sep 2012
The Chinese wine market: foreign and domestic
A GLANCE AT THE CHINESE WINE MARKET AND HOW IT LOOKS FOR FOREIGN AND DOMESTIC PRODUCERS
However, it is also a difficult market to break, with legislation, tax and consumption trends all providing obstacles that suppliers need to overcome.
IWSR's China Wine Market Report 2012 also identified an "invisible" market in
China, where consumers purchase whatever wines importers tell them to as a result of the strong bond between them.
The report warned that although more wholesalers are entering the market and capitalising on its potential, many lack experience.
Still, the French have managed to penetrate
China to a considerable degree, with Nicolas Ozanam, a director at UMVin, explaining that China bought 483 million euro (£383 million) worth of French wine in 2011.
In an interview with AFP, Mr Oznam revealed that Asia in general is a strong market for French winemakers, with UMVin representing the producers of 70 per cent of the wine output in
Discussing wine prices, the expert said it was a case of "wait and see" before altering the costs Asian consumers will pay for a French bottle.
"The current climate certainly won't encourage anyone to put their prices up without first knowing what the demand is like," Mr Oznam told the AFP in relation to global pricing.
Hong Kong purchased 417 million euro (£331 million) worth of French wine - a 27 per cent rise, with the Chinese market also growing 40 per cent.
Interestingly, the importance high-end consumers in
China place on branding was illustrated by Hubert de Bouard, Angelus estate's director.
Angelus has been featured in 30 movies, including 2006's 'Casino Royale', helping to drive up the prestige and popularity of the wine.
The label features a bell, which is a valued symbol in Chinese culture, making Angelus "a cult wine for the new business elite" Mr de Bouard told the AFP.
One question arises over domestic production - will Chinese winemakers build up more pace on home ground?
A recent report by Bloomberg Businessweek addressed this issued and uncovered the attitude Chinese consumers tend to have towards wine.
Thirty-six-year-old Emma Gao is a winemaker at
Silver Heights winery in Yinchuan, where, according to the report, some of China's most admired vintages are produced.
She told Businessweek: "Here, people think a good wine shouldn't give you a headache the next morning."
China having purchased 156 million cases of wine in 2011, the managing director of China Market Research Group Shaun Rein explained that consumer habits are shifting.
"Before, people would just buy wine to show off, but that's changing. Younger Chinese are drinking it at home," he told the news provider.
Estimates from the China Daily indicate that
China bought a minimum of 25 estates in the past year, demonstrating that foreign suppliers face further competition from domestic producers.
Currently, imported wines make up about 25 per cent of the Chinese market, research from Haiguan.info revealed, with
France, Spain, Italy, Chile and Australiaaccounting for 82 per cent of this figure.
Earlier this year, Changyu Pioneer Wine announced plans to fork out as much as $950 million (£586 million) on a "wine city" in the
Shandong , which is set to include a European-style village, Businessweek reported. province of China
With those kind of expansion plans in the works, it seems Chinese producers are attempting to fend off the advances of foreign companies, with Rising Securities analyst Zhang Zhiang telling the China Daily overseas wines would "eventually" make up half of the Chinese market.
- “Winning a silver medal in the HKIWSC has truly helped my product to achieve international credibility regarding its taste. This has positively affected
decisionmaking of several new merchants who now carry my product.”Kaustav BagchiOwner, Lamai Thai Spirits
- “Louis Royer Cognac has been entering the Hong Kong International Wine & Spirit Competition for many years. This competition is regarded as the most respected in Asian countries. Winning an award is a high honour for our brand and a further seal of quality for our multi-award winning Cognac.”Carol FrugierMarketing and Communications Manager, Louis Royer Cognac
- “Adding to our success over the past few years at the HKIWSC, winning a trophy means so much to us as we have just recently entered the Chinese market with our brandies. The Chinese market is unique, which makes it even more exciting to know that Oude Molen VOV Brandy is well accepted.”Kobus GelderblomBrandy Master, Oude Molen Distillery
- “It is a great honour for us to receive this award and we are very thankful about the reputation from wine enthusiasts in China. This award is a testament to the fact that our white wines not only match the traditional Austrian food but also matches perfectly with the Asian cuisine.”Katja PflogschWinemaker, Domäne Wachau
- “Having won three trophies in the last four years in different food & wine matching categories at HKIWSC has showcased Pegeric Pinot Noir and its suitability with Asian cuisines leading to its listing with one of Australia’s top restaurant – Melbourne’s iconic Flower Drum.”Chris CormackCEO, Pegeric Wines
- “To get recognition from such a prestigious panel is
veyrewarding indeed, and proves that our wines are made in a style that is truly food friendly. The HKIWSC has become one of the year’s most well-respected wine competitions globally. For us, the food match component is a fantastic chance to demonstrate how well our wines compliment so many different flavours. Moreover, it is a competition known and valued by our customers so a trophy can be hugely influential.””Susanna MayerWinemaker, Yealings
- “Awards and medals at the HKIWSC have been like a stamp of approval to the quality of our wines. Because it is an Asian-focused competition, I know that my wines are being judged and measured by the same yardstick as all the other wines, given our viticultural conditions are quite unique compared with the rest of the world. These medals give me and, more importantly, my consumers the confidence that my wines stand apart from the competition.”Kalash GurnaniWinemaker, York Winery
- “We are very proud of our results. One of our key focuses is the Asian market, so we really want to make our wines special and desirable for this market. That’s why we want to enter this competition and be evaluated by the expert judging panel.”Sofia Cajewski Winemaker, Cremaschi Furlotti
- “We at Yealands Estate Wines are proud to be
recognizedby the Hong Kong International Wine & Spirit Competition. The organizationis held in the highest regard and our success in the competitions has become a strong voice for our quality around the globe.”Avram DeitchGlobal Marketing Manager, Yealands Wine Group
- “Winning awards in reputable international wine shows such as the Cathay Pacific HKIWSC is one of the many ways of educating our consumers and giving them confidence in purchasing the Saint Clair brand. This enhances brand perception
increases sales across our entire portfolio of wines.”Maria EastonWinemaker, Saint Clair Family Estate anin turn