Imported wines won’t take up 40% of market in China

Despite imported wine’s continuous growth in the Chinese market, its share won’t be able to surpass 40% in the next five years, one Chinese official has claimed.

Zhao Yu (Photo credit: Along Wine Group)

The comment, made by Zhao Yu, deputy secretary of China Association for Liquor & Spirits Circulation, came at a time when market confidence in domestic wines seems to be faltering as China’s wine production has been dropping for years.

Domestic wine production has suffered four years of consecutive losses, dropping yet again 1% to 11.37 billion litres in 2016, figures from the National Bureau of Statistics showed. Meanwhile, imported wines in the country grew 15% year-on-year to 638 million litres last year.  

Bottled wine imports in particular, grew by 21.8% year-on-year in volume to 481 million litres.

Despite the strong momentum, Chinese wines still dominate the market with a current share of 70%, the official said, adding that domestic wines’ image and quality have been greatly improved as promotion among consumers seem to have paid off, China Food Newspaper reported.

“Although production wise, there’s no increase in domestic wines, based on my research and study of the market, its market share has come to stabilise, hovering around 70%. Squeezed by imported wines, domestic wines have improved notably in terms of product quality, marketing and sales, especially with lesser known second-tier or third-tier brands. Their performance in recent years is satisfying,” the trade official was quoted as saying.

Deputy head of Shandong Yantai Vine and Wine Office, Zhang Xu, added that imported wines’ year-on-year growth rates in terms of volume and value in 2016 were slower compared with 2015 (45% increase in volume and 34% in value). “This means imported wines’ market still has bubbles and it is feeling the market squeeze as well,” Zhang told the newspaper.

Judging by China’s overall slowing economy, a full recovery and strong growth for China’s wine market in the coming years is obviously too optimistic, Zhang added.