Chinese Are Snapping Up French Vineyards

on April 1 2011 | in Lifestyle Trends Wine & Spirits | by | with No Comments

bordeaux-vineyards

China is cultivating new tastes in luxury beverages: wine. As Chinese consumption increases, Chinese investors are looking for ways to be a part of this industry. And what better way than to, quite simply, buy a vineyard?

That is exactly what Chinese investors are doing, starting in French wine country: specifically, Bordeaux. And although it’s a point of pride for many vineyard owners to sell their century-old wineries, Chinese demand may be just what the industry needs to recover from recent economic hardships.

Three properties have been sold this year, and three others – including Chateau Richelieu are already owned by the Chinese. Struggling chateaus will sell for the right price, and price does not seem to be an issue for the Chinese investors if they want the wineries.

Last year, China superseded Germany and the UK to become Bordeaux’s largest customer. This ranking shuffle is due in part to the growth of the Chinese wine market by 67 percent—but also by the decline of markets in other countries. Bordeaux saw a 25 percent drop in wine exports to Britain in 2009, and a 23 percent drop in exports to America.

Why the sudden surge in China? Before 2005, the Chinese wine market was anything but a major player. However, recent government initiatives have actually been encouraging the Chinese people to drink more wine for health reasons. Although governmental promotion of alcohol may seem strange to Westerners, to the Chinese it’s a matter of scale. The government wants to encourage its citizens to imbibe less potent brews: the current Chinese drinks of choice are brain-bending local spirits.

The Chinese are receptive to this government direction. However, their experience with wine is limited compared to Westerners—which leads to some practices that those accustomed to wine find unusual.

“I’ve been in meetings where a $2800 bottle of wine is drunk as shots or with ice-cubes,” said Shaun Rein, managing director of the China Market Research Group. “It is not about trying to savor or appreciate—they just buy whatever is most expensive.”

To the West, which has developed a complex culture of wine appreciation, this use of wine is appalling. But to the Chinese, it is part of the process of integrating this beverage into their own cultural understanding.

This difference in sensibility is most striking for owners of vineyards newly-purchased by the Chinese. Patrick Etineau, a disgruntled former Bourdelais winemaker, complained: “I was happy to sell, because I couldn’t maintain the property, but now I have the impression that they don’t care at all.”

As the Chinese establish a wine market, hopefully tensions such as these will ease. Projections suggest that Chinese wine drinkers will increase to 330 million people in the next year. And although the French are not likely to warm to foreign investors that quickly, it will certainly not be long before the Chinese, too, come to love the age-old Western beverage.

 

 

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photo credit: crt aquitaine

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