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China Wine Country...? by Per and Britt Karlsson04/09/2017  

Already today China is a big force on the world market for wine. This week Britt, my co-author of this column, is in China. One of ten invited international wine experts to judge a wine competition with Chinese wines in the Ningxia region.

Britt was there already in 2005, on a similar mission. I am sure that much has happened in the 12 years that have passed.

In 2005, the Chinese wines were not something that impressed. The wines in the 2005 competition were overall barely passable. The sense of what we in the “West” think of as wine was not very strong. Some tasting flights had rice wine instead of grape wine.

Britt Karlsson tasting at the Ningxia wine competition in China, copyright 

In 2005 there was not a single wine planted in Ningxia, where Britt is this week. Now they have 40,000 hectares (100,000 acres), a third of Bordeaux.

It will be interesting to hear how the wines are today. Have they improved? I think we can be fairly certain that they have.

China will undoubtedly have a major impact on the world wine market in the future. But how is hard to know.

Wine is a fairly new phenomenon in China. It is not a traditional drink with a meal. What, when and how to drink will therefore depend on things other than traditions.

Vineyards in Ningxia, China, copyright BKWine Photography

Already today China is an important player in the wine world. China has the world’s second largest area planted with vines. Only Spain has more vines than China. France is third, and then Italy. These are the world’s top ten vine growing countries today (source OIV, figures for 2016):

Spain, 975,000 ha, (2.4 million acres)

China, 847,000 ha, (2.1 M acres)

France, 785,000 ha, (1.9 M acres)

Italy, 690,000 ha, (1.7 M acres)

Turkey, 480,000 ha, (1.2 M acres)

Argentina, 224,000 ha, (554,000 acres)

Chile, 214,000 ha, (529,000 acres)

Portugal, 195,000 ha, (482,000 acres)

Rumania, 191,000 ha, (472,000 acres)

Australia, 148,000 ha, (366,000 acres)

This does not mean that China is the second largest producer of wine in the world (as many wrote when China overtook France in vineyard area a few years ago). A majority of the grapes are used for other purposes, edible grapes, grape juice, raisins… Turkey being number five makes that obvious too.

Welcome to the Ningxia Helan Mountains wine competition, copyright BKWine 

But China does make a lot of wine. In 2016 it was the world’s 6th largest wine producer. However, Italy, who was the biggest in 2016, makes more than four times as much wine as China. China has about the same wine production as Australia, South Africa, Chile and Argentina. Around 10 million hectolitres each. Here’s the world top ten wine producing countries (source OIV, figures for 2016):

Italy, 50.9 million hectolitres (Mhl)

France, 43.6 Mhl

Spain, 39.3 Mhl

USA, 23.9 Mhl

Australia, 13 Mhl

China, 11.4 Mhl

South Africa, 10.5 Mhl

Chile, 10.1 Mhl

Argentina, 9.4 Mhl

Germany, 9 Mhl

China is also a major importer of wine. Sometimes it is said that China only buys exclusive and expensive wines. That’s wrong. It was truer a few years ago, before anti-corruption and bribery became a major point on the political agenda. This dramatically changed the picture. Giving expensive bottles as gifts or throwing lavish parties with exclusive wines became more difficult, at least for employees of the state.

Nevertheless, China does buy a lot of luxury wines as well. There are many rich Chinese people. There are simply many Chinese people.

One illustration of the importance of China on the world market today is that the country is the largest export market for Bordeaux wines, by a good margin. That does not happen by just buying luxury wines. Other wine regions have not been as fortunate though. At least not yet.

Vineyard landscape in Ningxia, China, copyright BKWine Photography

But it’s true that strong brands (for example, famous chateau names) are important. That’s probably why Bordeaux, the world’s strongest wine brand, is doing well in China.

There is also a lot of talk about Chinese buying up vineyards. Yes, it’s happening but it’s not on a big scale. Not yet, at least. Also in this case it is about well-known names, or at least well-known districts. It is primarily in Bordeaux this happens. It is estimated that some 140 Bordeaux chateaux are owned by Chinese today. Of a total of around 7000 properties, so it’s not an invasion. But this is not without its problems. Chinese culture values speed. So if the development of the business is not fast enough (or good enough) the interest might wane. Of the 140 Chines Bordeaux Chateau it is said that 50 are up for sale.

It will be interesting to hear what Britt has to say when she is back from China. (More reading: Our review here on Forbes of the book Thirsty Dragon, by Suzanne Mustacich, on how the Chinese came onto the world wine scene.)

What is pretty certain is that China will have an increasing impact on the world wine market.