Is the Mighty Asian Wine Machine Slowing Down?

 


There's no doubt that China has been the premier wine consumer in Asia, reigning the headlines for the past six or seven years. 
 
From the country's obsession with France's Bordeaux region to its recent austerity measures in which wealthy government officials were encouraged not to gift ultra-premium wines, the veritable king of the Eastern wine world has built a reputation for its growing thirst for wine and wineries. 
 
Yet that trend may be coming to an end, according to a story by industry website Just Drinks. 
 
Reporter Chris Losh said China's recent stock-market woes have revealed that all may not be quiet on the Eastern wine front. 
 
“While more Chinese are drinking a couple of bottles every month, fewer are drinking on a weekly basis,” Losh wrote. “And the average price of take-home wine for at-home consumption has dropped from $37 in 2013 to just $26 last year.” 
 
Part of this decline is due to a principle known as the Peak Wine Theory (PWT). This theory states that each country's wine industry rises to a peak at which it's popularity reaches its maximum heights. From there, the only way for the industry to go is down. 
One could make the argument that the PWT is in play in China, where, over the past ten years, French producers in particular have seen an unbelievable rise in the value of ultra-premium wine only to see Chinese buyers tighten their wallets under the government's new austerity measures. 
 
Wine imports are in a decline as well. Though the import market is still growing by a small margin, it's overall growth numbers have dropped from 5 percent in 2013 to 3 percent this past year. 
 
China's seemingly stagnating wine market has global ramifications because, as Losh put it, “China has been the engine that has driven the wine world for much of the last decade.” 
 
Statistics from the past few years have shown that wine drinking is on the decline in Europe, the reigning king of the wine world. While Losh didn't go as far as to blame China for this decrease, he did say the intense Chinese interest in French reds may have diverted marketing dollars from more traditional markets that are now suffering because of the neglect. 
 
“Over the  next few years, wine companies will have some big decisions to make regarding where they allocate funds and focus,” Losh wrote. 
 
Photo Credit: Pixabay

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