The Chinese wine market

Blog Mirabeau story

Developing new export markets for Mirabeau is vital for us and so when I noticed a wine trade fair taking place in Shanghai, and given that it was the week following another big exhibition in Hong Kong, I thought I’d better attend it. But as a small family business we don’t have the luxury of mega-budgets for glitzy stands and all the marketing materials required to make an impact in such a busy and competitive market. So we had to take a different approach and fortuitously, through a friend of a friend, I managed to base Mirabeau on one of the largest stands exhibiting at ProWine China 2013. And what an interesting time it was…

  • WineStars World Competition Shanghai

China might seem like a very obvious country to develop as an export market. After all, it is the most populous country on the planet and with words like ‘tuhao’ (the Chinese word for ‘bling’) being nominated for next years Oxford English Dictionary, you might think the new found wealth in China would bring with it an appetite for the top wines of Europe. But it is far more complex than that.

Demand from the rich elite of China for the top wines in the world has led to fine wine prices soaring over the past 5 years or so. The wine auctions in Hong Kong are famous for their Chinese clients who will seemingly pay eye-watering prices for the likes of Chateau Lafite-Rothschild (e.g. US$52,622 for a case of 1982) and Domaine Romanee Conti (e.g. US$107,000 for a case for 1988).

The record for the price of a bottle of wine was achieved in 2010 when auctioneers Sotheby’s in Hong Kong sold three bottles of 1869 Lafite wine for US$233,972 each.

Certainly this is a country whose economy is on fire as a result of the massive growth over the past twenty years and with the new found wealth comes the desire (and ability) to buy the best of everything the world has to offer – be it cars, super-yachts, private jets etc.  A throwaway statistic that I picked up this week is that the average age of a Lamborghini buyer in Shanghai is 22 year of age.

To a large extent the Chinese wine bubble has burst and the new government last year, led by Xi Jinping, has clamped down on gifting (often used in business to thank clients or to curry favour) and extravagant banqueting, which has had a dramatic and almost overnight impact on wine sales in China.

And this is great news for wine producers from all over the world, as genuine Chinese wine consumers can emerge, ones who are discovering wine as a product to be enjoyed, rather than given away or as an ostentatious display of wealth.

However, the truth is that the vast majority of people in China have never tried wine. In fact, the translation of white wine (baijiu or 白酒) refers not to fermented grape juice but a strong grain-derived spirit (typically 40-60% alcohol by volume) and which, due to the scale of things here, is also the worlds most-consumed liquor.

As a Provence rosé, Mirabeau is ideally suited to Chinese cuisine, but given that most Chinese don’t drink wine with food, this was another cultural wake-up call for me. But times are changing and the younger generation are looking towards other cultures for inspiration and US and European habits (drinking coffee, beer and wine) are being absorbed as a result of copious hours watching imported TV shows and films.

China is one of the oldest civilisations on earth and habits will change slowly. I hope to have made some useful contacts here on this, my first trip to China, and I have learned a lot about this vast and fascinating country.

Perhaps one day Mirabeau rosé will be sipped by hard working young Shanghainese professionals at M on the Bund, but if it takes several more trips out here to make that happen, then I hope I enjoy each one as much as I have enjoyed this one.

Stephen Cronk
The author: Stephen Cronk

I became captivated with the world of wine whilst on a visit to the Barossa Valley during my gap year in Australia. I went on to join a London wine merchant and studied wine for several years before starting my own wine business at 24. I sold the business aged 30 and went into Telecoms for 15 years, during which time I began cooking up the plan to create Mirabeau.

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