Samstag, 24. Juli 2010

Emerging Wine Countries: Brazil, China, India & Russia

This event at the MW Symposium was moderated by Tim Atkin MW and featured the following presentations:

Judy Leissner, president of Grace Vineyards, on China as wine producer and international marketplace:

















China as emerging wine-producing country:
The 3 largest wineries in China, Changyu, Dynasty and Great Wall, are all state-owned. For good reasons, as there are plenty of government departments to deal with on a daily basis, very challenging for private estates! You cannot be small as a private winery in China, as you would pay low taxes which equals no voice and no rights. You must be strong and rich to get around in business!
China's one-child-policy seems to have a severe impact on the employees attitude towards work nowadays: After having been raised by their parents and two sets of grandparents (= 6 adults spoiling the one child), employees tend to quit very easily if being criticized.

Plantings seem to be 85-90% black grape varities (with Cabernet Sauvignon dominating) and 10-15% white grape varieties (especially Chardonnay). However, there are no reliable sources yet for statistics of any kind.


China as emerging market:
China's 1,3 billion citizens are composed of 55 ethnic groups. So there is nothing like "the typical Chinese" wine consumer. For the sake of simplification, the typical Chinese wine consumer is 40-60 yrs. old, male, drinking a lot without particularly liking it, mostly at occasions involving entertainment of and/or showing off to clients at dinner parties. He is not well educated on wine production, and that's why doubtful messages like "We only use barrels that are more than 100 yrs. old" are perceived as sign of quality by him.
High Volume / turnover is not made in 5 star hotels, but in the local restaurants. These, however, charge for listing any wine. And the less known a winery / brand is, the more expensive it is to get it listed.

White wine is less popular, but for that very reason less likely to be faked, thus its authenticity more trusted.


Eleonora Scholes, journalist and consultant on Russia:
Russia as emerging wine producer:
The Krasnodar region near the Blac Sea is currently the center of quality wine production, but another region, Rostov, is evolving and showing great potential as well.

Russia as emerging market:
Some 1000 yrs. ago, when chosing their religion, Russian rulers made sure to select one which allows to drink (even a lot).
Russians tend to be big spenders and do not bother to save money. They are unpredictable and opinionated in their wine consumption patterns, but highly cultivated and educated.
Red wine is preferred, if white wine is drunk, it is very likely to be sparkling.
Foreign wine has a superior image to the ones produced locally, and European wines are associated with a high cultural value. Heritage is key to market super premium wines, so Italy, France, Germany, Spain (and increasingly Chile!) are leading the list of suppliers.
However, due to Gorbatchov's anti-alcohol campaign in the 1990s, wine lost a lot of volume though, whilst beer won.


Dirceu Vianna Junior MW, Wine Development Director of Coe Vintners, on Brazil:
Brazil as emerging producer:
Currently, 88,000 ha are under vines, mostly non-vitis vinifera, however. There are currently 310 wineries. The most exciting new regions are the Santa Catarina Plateau and Campanha (said to be the new California), joining the more established Serra Gaúcha.
Only a very small percentage of the production (worth 5.5 $) is exported.

Please see also my recent blog entry on wines from Brazil (covering the Vinopolis tasting in May).

Brazil as emerging market:
Dynamic migration of classes, as middle class increases drastically, so does the purchasing power. In 2010, Brazil's economy grew by 9% and there is no national debt at all (!!!!!!!!!).
Of the 319 million litres total consumption, 31 million litres come from domestic vitis vinifera production, 59 million litres are imported (mainly from Chile, Argentina, Italy, Portugal and France), and the rest (= the vast majority of volume) comed from domestic non-vinifera wines.
Although both consumers and on-trade locations in the major cities are becoming more and more sophisticated, most potential or occasional wine drinkers still lack a lot of wine knowledge.
Red wines are preferred, as accompaniment to meat dishes loved more than any other food. White wines are under-represented though and pose an opportunity.
Wine Spectator is the most influential critic regognized by the public.


Magandeep Singh, Indian sommelier, wine writer and TV personality, on India:
India as emerging producer:
Good potential. But subsidies that are given to wineries as support of agricultural companies are often taken without doing anything with it, without even producing wine at all. Money could be so much better used in other ways!

You may also want to read my recent blog entry on wines from India (covering a tasting at LIWF).

India as emerging market:
India is very diverse and full of myths.
With an average income of 200 EUR per month, purchasing power in India does not seem to be very promising for foreign wineries. Adults keep living with their parents (not only because of family ties / attachment to their Mom, but also for very rational, financial reasons).
There is a ban on advertisements for alcohol and an extremely complex tax structure for wine imports + trade across the states!!! Bad infrastructure, underdeveloped logistic options and inadequate storage facilities come on top of that.
Anyone not fearing the many risks may find his way to the market, which develops and grows quickly.
Indians are more interested in drinking wine on its own, not so much in pairing it with food, as occasions when wine is drunk are rather not along with meals.
Cricket and Bollywood are desirable to connect your brand with and promising Marketing approaches.



Pictures courtesy of http://www.mwsymposium.com/

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