Chilean wines find a market in China

Updated: 2014-06-30 05:40

By JACK FREIFELDER in New York (China Daily Latin America)

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Chilean wines find a market in China

Chilean wines are displayed at the Top Wine China 2013 held at the China National Convention Center in Beijing last June. Provided to China Daily

China's market for red wine is expanding and Chilean winemakers are hoping to tap into the growing Chinese consumption, according an official with a multinational Chilean wine organization.

Marybeth Bentwood, executive director for Wines of Chile (WOC) USA, said, Chile is "bullish" about prospects in China.

"Increasing domestic production and the simultaneously increasing demand for imports indicates to me there is a very healthy wine culture forming in China," Bentwood said Sunday in an email to China Daily. "Chile exports 70 percent of its wine production, making it one of the most export-oriented wine producing countries."

"Chile is the world's eighth largest wine producer and fifth largest exporter," she said. "Given China's population size, any increases in per capita consumption will appeal to Chile."

In addition to being the world's largest alcohol market, China is also the biggest global consumer of red wine, per data from a January 2014 report by International Wine & Spirit Research (IWSR).

The country, including the wine hub of Hong Kong, consumed 155 million nine-liter cases (1.87 billion bottles) of red wine in 2013. France and Italy rounded out the top three with 150 million and 141 million cases, respectively.

Red wine consumption in China nearly tripled between 2007 and 2013, according to a Jan 29 story by The Wall Street Journal, while the other two leading wine-consuming nations saw reductions.

WOC is an organization committed to promoting the quality and image of Chilean wine throughout the world. It has more than 90 wineries among its members, a group that produces nearly 90 percent of Chile's bottled wine exports, according to WOC data.

With offices and representation in Brazil, Canada, Chile, Hong Kong, the United Kingdom and the United States, the group has a goal of making Chile the top wine producer in the Western Hemisphere by 2020.

WOC also works with ProChile, an arm of the Chilean Ministry of Foreign Affairs, to promote the export of Chilean goods and services abroad.

ProChile, which hosts an annual series of wine-tasting events and seminars to promote Chilean wine abroad, has a network of over 50 offices worldwide and 15 export centers in Chile.

Bentwood said Chile produces "significantly more" red wine than white, which is another factor that helps make Chilean wine a "perfect fit for China's wine culture".

"Chile is one of the world's best places to make wine," Bentwood said. "The industry, however, is export driven and that export focus is just over 20 years old. In those two decades investment, exploration and expertise have revolutionized the industry."

"Additionally, the free-trade agreement between both countries only facilitates a better relationship," she said.

Chile and China enacted a free-trade agreement (FTA) in 2005, China's first FTA with a non-Asian country.

A September 2013 article from JP Morgan Chase & Co., titled, Corridors of Power: China's Latin American Linkage, said: "China's trade with Latin America has flourished over the past decade, hitting $261.2 billion in 2012 - up from $100 billion in 2009 and just $10 billion in 2000. Flows between the two are projected to hit $400 billion by 2017."

"Exports of bottled wine to China increased almost 83 percent in 2012, which made China the third largest wine import market in volume and value," the report said. "[Chile's] wine industry, already a regular medal-winner at the China Wine and Spirits Awards, is well on its way to realizing plans to increase export revenues to $3 billion by 2020."

Bentwood said quality advances in Chilean wine offerings make its position in China "compelling and globally competitive".

"China's interest in Chilean wine couldn't come at a better time," Bentwood said.