A roundup of wine news coming out of China this week, from the inroads made into the market by Californian winemakers to the issues with counterfeit bottles that continue to plague the Chinese wine industry.
Workers at the Murphys Vintner in California ready bottles for shipping (Image: Sacramento Bee)
The Sacramento Bee reports this week that Californian wine labels like Lange Twins, Ironstone and Michael David, all from the Lodi region, are finding a new and receptive customer base in China's increasingly sophisticated urban middle class. From the article:
"Now the Chinese market isn't just about expensive French wines," Kautz said. "Their taste preferences have evolved. It's a population that's becoming more affluent, they're Internet-savvy, they're reading up and wanting to embrace Western culture."
California vintners are raising a glass to this news, and concerted efforts in Lodi, Napa, Sonoma and Paso Robles are dovetailing with statewide campaigns to crack the lucrative Chinese market. Scattered wineries throughout Sacramento and the foothills are also pursuing sales to China.
Along with the opportunity, however, come pitfalls in the form of shady business people looking for a quick buck, [winemaker Joan Kautz] cautioned.
Still, the potential is alluring. In 2011, sales of imported wine in China are projected to surpass $1 billion, up from just $60 million in 2004, said Frank Gayaldo, a Lodi wine grape grower and international wine broker.
The article goes on to note that although American wine currently only has market share of about five percent in the China market, 90 percent of American wines now being exported there are Californian. Despite the dominance of France in the imported wine segment in China, American exports are steadily rising, reaching US$45 million last year, a 27 percent increase over 2009.
(Lafite) buyer beware
The Drinks Business writes this week on the continued problems with counterfeiting that only seem to be intensifying as China's thirst for wine grows -- a topic Jing Daily has covered several times in the past. As Romain Vandevoorde, head of wine importer Le Baron, told the AFP this week, in China “Fakes are everywhere – from bottom- to top-of-the-range.” From the article:
Supermarkets – where the majority of Chinese buy their wine due to a lack of specialist merchants – are full of fakes.
Prices vary drastically, from as little as 90 yuan to as much as 35,000 yuan for an exceptional vintage.
At wine fairs in China, merchants can be found openly exhibiting counterfeit wine, some of which are very poor imitations.
“At a recent trade fair in China, I saw merchants openly selling fake Lafite – as you would Louis Vuitton handbags in a market – in a small room next to the main tasting room,” Simon Staples, buying director at Berry Bros & Rudd, told db.
Counterfeits include bottles of Bordeaux that have been diluted with sugared water and had colouring agents and artificial flavourings added, before being sold for high prices.
While there's little new here, one thing that prospective wine buyers in China always need to pay attention to is reflected in a quote by Vandevoorde: "There is more Lafite ‘82 in China than was produced in France. So you really have to be wary if you find any of that in China" -- which itself echoes what Jing Daily heard from Beijing-based drinks blogger Jim Boyce last year. It's not quite "buyer beware," but at least "be aware" that counterfeiting is a nagging problem in China's wine market.
Changyu is one of the oldest winemakers in China
While China's "big three" domestic wineries -- Great Wall, Changyu, and Dynasty -- continue to pump out an ever-increasing volume of wines of both lower and gradually higher quality, expert opinion remains mixed as to whether China's home-grown vines truly are producing world-class wines. Still, as Chinese "micro-wineries" like Silver Heights (Jing Daily interview) and Grace gain plaudits at home and abroad for their Bordeaux-inspired reds and imports from Europe, North and South America and Australia swell, big names like Changyu are rolling out new initiatives that they think will help them raise the visibility and reputation of their products. Via China Daily:
Changyu has strict standards for planting with only 10 to 15 clusters of grapes kept on each vine to ensure each cluster of grape getting enough nutrition. And in the Chateau Changyu AFIP Global, only 266 vines are raised per mu, and the grapes from each vine are only be used to produce one bottle of premium wine.
In addition to ensuring grape quality, Changyu has spent a great deal on state-of-the-art equipment to produce a global winner.
It has an electronic tag for each bottle of its top wine so that customers can get more information on the wine, for example production, storage, and sales.
Changyu also has several chateaus, one of which, Chateau Changyu-Castel, was China's first to be built to international standard, in 2002, in Yantai, Shandong province, home of Changyu.
The company also opened an ice-wine chateau in Liaoning province, in the northeast, and Chateau Changyu AFIP Global, in Miyun county just outside Beijing, in 2006.
Another three chateaux are under construction in Shaanxi province and the Xinjiang and Ningxia autonomous regions, and scheduled for completion by the end of the year, all of them top grape-producing areas.