Chinese wine production drops for fifth year in a row
Wine production in China has dropped for the fifth year in a row to reach a new low of only 10 million hectolitres last year, a 5.25% reduction from the 11.37 million that were produced in 2016.
This is according to the latest data from the National Bureau of Statistics, which shows that not only is domestic wine production dropping, but sales have nosedived in the past year by 9% to RMB42.137 bn.
China is the world’s sixth largest wine producer in 2016, despite being second only to Spain in the area under vine, according to the OIV. However, while domestic production has dropped, imported wine volumes and consumption continues to grow, with imports up by over 17% to reach 732,000 litres, with value increasing by 17.58% to US$2.174bn.
Chinese winery Yantai Changyu Pioneer Wine Co told the Global Times last month that its 2017 wine production was almost the same as in previous years, but said the country's overall decline in production was largely down to structural overcapacity, public consumption limits and a surge in imported wine.
"The continuous increase of imported wine in the Chinese market has seriously squeezed the market share of domestically made wine,” claimed the company.
"Chinese wine consumers are becoming more rational, which, together with the widespread entrance of foreign wine brands into the domestic market, is squeezing wine output by domestic producers," said Gao Yuan, owner of Ningxia Silver Heights Winery
And Qu Xing, CEO of winesinfo.com said that important wines had a better reputation than domestcially produced varieties, and are generally of a better quality. Domestic wine producers still suffer from lingering perceptions that they produce fake wine, and are not widely trusted.
"Foreign wines have a longer history than their Chinese counterparts. Polished over time, foreign wines have a better taste and quality compared with domestic ones. On the contrary, domestic wine producers once gained a bad reputation for producing fake wine, making them even less favored and trusted," he said. A lack of grape varieties planted in china was another factor contributing to the shortage in domestic wine production, he added, with the vast majority of vineyards only growing either Cabernet Sauvignon or Merlot..