Bordeaux exports less to China

Dec 02, 2014 No Comments by

Between 2009 and 2014, exports of still wine to the Middle Kingdom exploded, gaining 168% in value and 231% by volume. However exports of Bordeaux in the world fell by 28% in the first semester of 2014 according to the Federation of Exporters of Wines and Spirits (FEWS).

China is the cause of this drop.

This 28% decline in the first half of this year is largely due to the decline of the Chinese market. China has indeed been Bordeaux’s first customer for several years.

Anti-corruption Policy in China

The new law enacted by the central government in Beijing against corruption and extravagant spending of officials had a very big impact on gifts deemed excessive, as to know: expensive wines and spirits. The Middle Kingdom has become a boon for many wine houses of Bordeaux, as other clients, like the Americans, wrinkled their nose at the extremely high price. Between 2009 and 2014, exports of still wine to the Middle Kingdom had exploded, jumping 168% in value and 231% by volume. The chill is now strongly felt.

chinois sent vin

The cognacs also suffered greatly with a drop of 12% in their exports. In fact, according to the FEWS “the third of the fall in turnover recorded by the French wine and spirits in China in the first half of the year” is a consequence of the new Chinese law. Overall, the wine and spirits trade in Asia is “trending down, with a fall of almost 13%, despite a positive trend in South Korea and Malaysia.”

The UK market back

There are other countries responsible for the difficulties of French products, namely because of the slowdown in the global economy. “The economic recovery is expected in the world,” said Christophe Navarre, Chairman of FEWS. North America has not recovered the dynamism expected. Imports of French wine and spirits were down 2.1% in the first half of 2014, although the FEWS judges that as a “positive outlook.” In Europe, the UK market, second export market and hub for re-export to China, has led to “a marked decline in the area.” Strong sales in Northern Europe, including Norway (+ 11%) and Sweden (+ 7%) are far from being enough to compensate for the shortfall. In Russia, the political and economic context explains a decline greater than 10% exports. In this difficult context, champagnes showed very good performance with higher volumes of 6% and 8% in value.

cave vin

Another explanation for this situation, the consecutive rise awards to two small harvests of 2012 and 2013 in France. Marketable volumes decreased 5% in the first half. The low availability pushed prices up and reduced the competitiveness of French wines, says the FEWS. In this context, the Loire Valley (+ 8%), Languedoc-Roussillon (+ 4%) and Alsace recorded “good performance.”

 

To go further:

Chinese Wine Industry

About the author

Olivier VEROT, is a Marketing expert for the Chinese Market. He will speak about the Internet trends about wine and about the Marketing best practices.
No Responses to “Bordeaux exports less to China”

Leave a Reply