DAN'S WINE BLOG- A QUICK CHINA UPDATE

August 7, 2020

According to figures released by the China Association for Imports and Export of Wine & Spirits (CAWS) - The total volume of imported wine in the first five months of the year was 180 million litres, worth US$690 million. The cumulative volume decreased by more than 30%, bottled wine accounts for 94.2% of the total wine imports, while bulk wine has a 5.8% share.

The volume and value of Australian wine fell by 2% to 4 % from January to April, yet the country remained top of the import chart at 37.6% of total imported wine. France’s market share was also stable during the period and the country remains 12% below that of Australia. Chile suffered a decline of cumulative volume and value of over 40%, however it remained the third largest export market. The fourth and fifth largest market shares from January to May this year were wines from Italy and Spain. New Zealand posted a cumulative volume and value decline of 20% from January to April, yet its market share ranking rose from 11th to 9th place.

While these figures are rather gloomy, to help put them into some sort of context, the volume of wine being produced by China (contrary to popular belief) has declined markedly over the last few years.

In 2012 China produced 1.382 billion litres of wine whilst Australia produced 1.23 billion litres. Fast forward to 2019 and China’s production was 0.451 billion litres, whilst Australia’s was 1.77 billion litres. The drop in China’s wine production over those seven years is the equivalent almost 103.5 million cases of wine. In the same time frame the imports of wine (from all countries) rose by 0.300 billion litres or 33.5 million cases. This is a gap (reduction) of 70 million cases of wine!!! Some of that reflects stock reductions within China but it is also partly due to lower consumption.

Thus in effect whilst we have until now been patting ourselves on the back as to our sales performance in the Chinese wine market (big growth and beating the French as No.1 imported wines country) we have failed to notice that despite the ever growing “middle-class” (an indicator of potential wine sales), the total sales of wine in China have been declining for most of the last seven years.

BAIJIU: China’s white spirit sales are currently eighteen times larger than wine sales according to “The Grape Wall of China”, in an interesting article on “China’s shrivelling wine scene”.

Article Link:

https://mailchi.mp/227cec5ea303/grape-wall-july-2020?e=254cbf3ea6

Photo Credit: www.grapewallofchina.com

So that is what the situation is under closer scrutiny and given the Chinese President suggesting that his people should be drinking Chinese wine (see my blogs below) I think Australian wineries (like I have said before) should be looking at expanding into other markets around the world, especially in Asia.

Blog Links:

2020-06-26 NO GOOD NEWS

and

2020-07-17 UPDATES FROM OVERSEAS

I will now step back down from my hobby horse and wish you a great week. Enjoy wonderful Aussie wines and please stay safe. Cheers!