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Global wine production decreases, says Morgan Stanley
According to a recent Morgan Stanley report quoted by news website Business Insider, global wine production has reached its lowest level in 40 years – which hints that in the near future wine supplies may be insufficient to meet demand.
Although the production of wine has decreased, Chinese interest for the product hasn’t. On the contrary, figures show that China and the USA have increased their demand for wine, with the Chinese wine consumption having doubled twice in the last five years.
France is still the largest consumer of wine, but “the US and China are catching up fast (…) China especially is drinking wine like your freshman year roommate,” said Business Insider in its analysis of the Morgan Stanley report.
But those who believe China is a mere consumer might be wrong. Domestic production quadrupled over the past 10 years. Moreover, the report says China is now the fifth largest producer of wine, and its total consumption is expected to nearly double to 400 million unit cases by 2016 – turning it into the largest global wine consumer. According to the report, “further import demand will likely be required to meet the rising consumption gap.”
But other experts in the wine business are more skeptical. Treasury Wine Estates, described as one of the world’s largest winemakers, reports that consumer demand for wine in China has actually softened, due to a “recent leadership change and well documented government austerity measures.”
Business writer Anna Healy Fenton also reported in her South China Morning Post blog that the mainland wine market has cooled off. One of the reasons, surprisingly, lies with the president Xi Jinping’s anti-gifting drive – implemented to end old habits of free spending by civil servants, military officials and provincial party chiefs. He ordered an end to taxpayer-financed banquets and bribes such as gift-wrapped Louis Vuitton bags or expensive bottles of wine.
Nevertheless, the SCMP journalist stated: “the cult of officials expecting you to give them wine as a gift dies hard.”
Portuguese wine exports to China rose
The export of Portuguese wines to China rose three-fold over the last three years, reaching EUR12.1 million in 2012, says the delegate of AICEP in Shanghai (the Portuguese agency for Foreign Investment and Trade).
Speaking at a fair organized by the Bright Food group, Filipe Costa added that sales of wine to China totaled EUR8.5 million in the first half of this year. Portuguese news agency Lusa reported that the fair was exclusively attended by companies established in Shanghai, four of which were Portuguese. MDT/Macauhub
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