China’s entry-level wine market gets boost

14th July, 2014 by Simon Howland

A government crackdown on gift giving has slowed down sales of top end imported wines in China, but sales at the other end of the market are booming.

John Watkins ASC

John Watkins ASC

Speaking to the Wall street Journal, John Watkins, head of China based wine merchant, ASC Fine Wines, said of the measures: “We all thought the anti-corruption would be a six- or eight-month program.

“None of us imagined they’d double-down and deepen the reforms and policies.”

Watkins went on to suggest it’s not all bad and European countries other than France could be set to benefit.

“We’re selling more at the entry level. Burgundy is hot. We’re seeing strong interest in Italy and a growing interest in Spain,” he said.

Watkins also pointed out the potentially positive impact of the growth in the Chinese domestic industry, now the fifth biggest in the world, adding that a healthy domestic wine industry is “great for imports”.

Citing the US as an example, Watkins said: “In the early 1970s, there was very little domestic wine drunk and only a bit of imported wine being consumed in the big cities then in the 1970s, Californian wines took off and it brought average Americans into the market.”

Watkins drew further parallels between the US and the Chinese wine market, adding: “As volumes grew, people became more sophisticated and wanted to try other things—they started experimenting with French, Italian and Spanish wines. Then, the growth of imported wines grew faster than domestic wines. We’re hoping the same trend happens in China.”

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