Foreign winemakers are looking to China as the country's domestic consumption continues to grow.
Bottles of baijiu Image: Nozomiiqel |
China looks set to overtake Britain this year as the world's fifth largest wine market, according to a report from UK-based International Wine and Spirit Research, as the Chinese appetite for imported luxury goods increases.
Chinese connoisseurs are willing to pay top dollar for their tipple, as was shown in Hong Kong during the city's largest wine auction this year. The auction generated a grand total of $14.5 million (920m yuan) and included the sale of six rare bottles of Roumier 1978 Musigny for a record-breaking HK$463,600 ($59,500 as well as a case of 1990 DRC La Tache which went for no less than HK$537,000 ($69,000).
Some analysts forecast China's wine consumption will double to 250 million 12-bottle cases by 2016, meaning it could become the world's biggest wine market within the next 20 years. Many foreign producers are trying to get a foot on the ladder by attending this year's wine fair in the south China city of Hong Kong, where as many as 1,000 exhibitors from 37 countries, including lesser-known wine producers such as Georgia, Israel, Latvia and Malta, will be attending.
For many Chinese, however, the the fiery taste of Baijiu – a clear, sorghum based liquor – remains the drink of choice. Government analysts estimate the Baijiu market to be in excess of 500 million 12-bottle cases, or $21.7 billon per year (138bn yuan which has caught the eye of Western luxury winemaker Moet Hennesey, a unit of LVMH. The company will introduce its new line of luxury liquor to Hong Kong markets this month through Sichuan's Wenjun Distillery, in which it owns a controlling stake.
The 50% and above spirit has little market presence outside of the Middle Kingdom, as export sales make up for less than 1% of yearly profits - something that Chinese companies want to change. Wuliangye Group, a leading Chinese Baijiu maker, has paid $400,000 (2.5m yuan) for a spot on the famous Times Square billboard in New York, in a effort to increase the ancient beverages profile overseas. China's prestigious Moutai brand is also planning an aggressive marketing campaign across the U.S., Canada and Australia to take place over the next 5 years.