CHINA: Australian win battles for booming market
Updated
Two years ago Chinese wine consumption was, on average, one glass per person. But since China's move into the World Trade Organisation and the subsequent lowering of tariffs in the country, wine imports have boomed. It has created a great opportunity for the internationally-renowned Australian wine industry, but there are obstacles, including a drinking culture famous for its strong white spirits.
Presenter: Bo Hill
Speakers: Christopher Wright, senior trade commissioner Shanghai, Austrade; Jeremy Kasler, managing director, Australian Wine Index Singapore; Amanda So, product manager, Concord Wines Hong Kong; Rob Raffa, international business manager Asia, Pernod Ricard Pacific
HILL: There's no doubt that Chinese enjoy a drink. For the traditionalists - the higher the alcohol content, the better. So, when urban rumours abound of premium range white being mixed with lemonade, and red wine being drunk out of shot glasses, how do wine producers set about introducing a wine culture? SFX music. Christopher Wright, senior trade commissioner for Australian trade organisation, Austrade, says for Australian wine exporters it's about patience and education.
WRIGHT: Like all things, it takes time. And for a fully developed, mature culture it will take a long time it took a long time in Australia.
HILL: Wine importer, Jeremy Kasler from the Australian Wine Index in Singapore says the small but blossoming wine market in China is driven by a young and curious middle-class.
KASLER: More and more young Chinese people, you know the young, if you like yuppie types that have appeared over the last 6 or 7 years. It's become trendy to drink, particularly red wine - in wine bars or hotels or restaurants. Previously we saw of course most Chinese, particularly the older Chinese, drinking whisky or beer but that's certainly changed a lot.
HILL: Which, says Christopher Wright, is a bonus for Australia.
WRIGHT: Consumption is slow rising, it's rising faster in the big cities, and with consumption, then wine consumption is also going up. The Chinese middle class is generally counted at sitting about 60 million people, with an aspiring middle class three times that seize - and that group of people are beginning to explore different tastes, different lifestyles and in our case, Australian wine.
HILL: In 2005, after China became part of the World Trade Organisation, exports to China became a lot easier for millions of products. Australian wine exports leaped an estimated 350 per cent in the year to 2006. The growth rate since then has narrowed but it is still a healthy eight per cent. There's competition, though and one obstacle, however, for Australian wine is the clout of French premium wines. In the minds of the wealthy elite, says Amanda So from Concord Wines in Hong Kong, Bordeaux is still the ultimate statement.
SO: Very experienced wine drinkers - they tried Australian upper range or mid-range in the last few years but they don't like it. Because, compared to Bordeaux, the structure, the bouquet, the tannin is too straight forward.
HILL: Despite this, one of the most ubiquitous Australian wine brands, Jacob's Creek, is about to unleash its premium range onto China. Rob Raffa, from Pernod Ricard Pacific, the company responsible for marketing Jacob's Creek internationally, says he believes the time is ripe.
RAFFA: We have moved from Jacob's Creek traditional range and we're finding that Jacob's Creek reserve range is getting a hold in China. And that demand has led us to release our heritage range in August this year. We feel there's a huge opportunity for our high end wines.
HILL: Still, it was bulk Australian wine that enjoyed the biggest increase in sales volume last year, and Ms So says these Australian mid-range wines are very attractive.
SO: They are easy to drink and they are easy to buy. You know you can see the grape on the label and see the alcohol and see the government warning and you don't need to decant or age the Australian wine compared with French - Australian wine you can drink right away after you buy from the supermarket.
HILL: Which should help the exporters move their wine faster - into the banquet halls and living rooms of China.
SFX - Dean Martin
