Wine­mak­ers still keen on Chi­nese mar­ket


China’s clam­p­down on ex­trav­a­gance and cor­rup­tion has been a dark cloud for mak­ers of most luxury goods, but a new re­port sug­gests wine­mak­ers are see­ing a big sil­ver lining.

“To start with, there are 37 mil­lion Chi­nese who will reach drink­ing age in the next five years,” says Guil­laume Deglise, CEO of Vin­expo, the world’s big­gest in­ter­na­tional wine and spir­its ex­po­si­tion.

“That’s more than the pop­u­la­tion of Canada. Also, the mid­dle class in China is grow­ing by mil­lions, de­spite the re­cent eco­nomic slow­down. Fi­nally, per­capita con­sump­tion of wine in China re­mains very low — 1.4 liters in 2013 com­pared with 12 liters in theUnited States. So the growth op­por­tu­nity is def­i­nitely in China and the Asia-Pa­cific.”

That, of course, is not a new trend.

The growth of wine con­sump­tion in China has been ex­plo­sive for most of the past decade, un­til a se­ries of anti-cor­rup­tion poli­cies was ini­ti­ated by the cen­tral gov­ern­ment in2012. Spendin­gon ban­quet­ing and ex­pen­sive gifts slowed dramatically, un­der­cut­ting do­mes­tic and im­ported wine busi­nesses in a big way.

But Deglise, un­veil­ing an an­nual re­port this week on the global wine in­dus­try com­piled by In­ter­na­tional Wine and Spirit Re­search, says the pos­i­tives in China as­sure im­pres­sive growth ahead.

From 2009 to 2013, Chi­nese wine con­sump­tion leaped 69.3 per­cent to reach a to­tal of 162 mil­lion 9-liter cases, the equiv­a­lent of 1.94 bil­lion bot­tles, mak­ing China the fifth-largest winecon­sum­ing na­tion.

While in­dus­try ex­perts say the re­cent spend­ing slow­down will con­tinue for up to two more years, ac­cord­ing to the Vin­expo/ IWSR re­port, a re­cov­ery is ex­pected.

“Growth will never be as ex­plo­sive as be­fore,” Deglise says.

“But the fore­cast is that, be­tween 2014 and 2018, Chi­nese wine con­sump­tion will grow by a fur­ther 24.8 per­cent. That’s twice as fast as the US mar­ket, which was the fastest-grow­ing mar­ket in 2014 at 11.6 per­cent.

“We think grape wine is health­ier than tra­di­tional bai­jiu and has a more so­phis­ti­cated rep­u­ta­tion that ap­peals to young and newly af­flu­ent Chi­nese. That’s an im­por­tant fac­tor, long term.”

Red wines con­tinue to dom­i­nate the Chi­nese mar­ket, though roses, sparkling and sweet wines are all show­ing growth here as well as glob­ally. The 2015 Vin­expo, which will open in Bordeaux in mid-June, will fea­ture spe­cial tast­ing events for those three cat­e­gories.

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