South African wine has held its own in what has been a remarkably difficult year for Chinese wine imports. According to Marcus Ford, Asia market manager for Wines of South Africa (Wosa), 2019 can best be described as a challenging one. This comes after a decade of hyper-accelerated growth – both in the volume of wine shipped to China and perhaps, just as significantly, the number of wine importers in China. “It looks as if there is some consolidation taking place,” said Ford. “It is relatively easy for companies in China to import wines – and over the past several years many new companies have taken up importing wine as a “hobby business”. With the economy slowing down there has been some change, with specialist wine companies still growing, while the hobby businesses are starting to exit.” This, he said, had certainly been the case over the past 18 months. While all importers had been hit by the consolidation, South African wines had held up reasonably well, said Ford. “While volume and value have both declined, the average price per litre has been improving as importers in China seek to premiumise their offer.” This, he said, was good news for the future of South African wine in the Far East market. “The imported wine market in China is still very young, despite massive growth over the past decade. China’s wealthy urban population is increasingly drinking imported wine and that population is growing. Wine intelligence estimates that there were 52 million consumers of imported wine in China in 2016,” said Ford. “If one assumes moderate GDP growth of 6% and then assumes that the “drinking population” will be drinking more imported wine as they become more familiar with the category, then the future is clearly very bright for wine exporters.” Furthermore, considering South Africa’s strategy to reduce the amount of wine exported in bulk and focus on premiumising its offering, China will remain one of the primary markets for export growth. “Japan and Hong Kong are also important markets for SA wines – and while total export values cannot match those of China, they are both wonderful platforms for premium and fine wine producers,” said Ford. Indeed Japan has the highest average rand per litre of any major exporting country for SA wines.
INSERT: The imported wine market in China is still very young – Marcus Ford