Monday, January 31, 2011

A Sino Symposium: Wine in China

I lived and worked in Shanghai for 5 years from 2002 to 2007. It was a fantastic time to be in this decadent town as it grew at breakneck speed and emerged as a global city. The only real drawback for me personally was my inability to pursue my love of wine during this period. During the time I was there, there really wasn’t much of a wine scene to talk about. Most Chinese wine that could be purchased was not worth seeking out. Some decent overseas wine could be purchased in the large Western supermarkets that exist in Shanghai, but the range was very limited, and the price was typically double what you might pay for the wine in Australia. There weren’t any wine bars. Some interesting and quality wine could be had at some of the top Western restaurants but the mark up was ridiculous. As such 2002 to 2007 marked a significant hiatus in my wine journey.

Now, three and a half years later, my wife and I have just come back from a 3 week holiday in China. It was our first time back there since returning to Sydney in 2007. For my wife it was a chance to see her family who are in Sichuan, while for me I still have plenty of friends up there so it was a great chance to catch up with them. While we were pretty busy and did lots of travelling in between cities and provinces, I did also get a chance to look at how the wine scene has changed, through the time we spent in Shanghai, Beijing, as well as a visit we made to Qingdao, the capital of Shandong province, which is the largest producer of Chinese wine (and indeed where Chateau Lafite is developing a vineyard).

The wine scene in China

You have possibly read about the explosion of Chinese purchasing top global wines, in particular Bordeaux. Auctions in Hong Kong have seemingly come to fetch some of the highest prices globally for rare wines. Chateau Lafite placed the Chinese symbol for 8 on the 2008 Lafite, and apparently the auction price rose by 20% overnight. This rise in Chinese interest in wine is also now evident within China as well. The change in a place like Shanghai has been remarkable. Wine bottleshops and wine bars are evident throughout the centre of town, where 3-4 years ago they didn’t exist. Within these vinous locations, moreover, good ranges of quality wine can be found. Beijing is similar though perhaps not to be seen in quite the same numbers.

In Qingdao, there is a pretty impressive Wine Street that was opened in 2009. The street has about a dozen different wine retailers. These stores all have slightly different focuses, with one for example selling solely French wine, some selling solely Chinese wine, and some selling a combination of local and imported wine but with perhaps a focus on Chilean wine for example. On this street there is also a wine museum, which was actually a very impressive venue. You walk down a tunnel that takes you a fair way underground and there is then a labyrinth of displays and presentations that is very informative and well set out.

(The entrance of the Wine Museum in Qingdao)

This wine scene, whether you be in Shanghai, Beijing, or Qingdao, is dominated by red wine with apparently about 85% of the wines China imports being red. For many Chinese people, wine is red wine. They have their own sorts of golden and straw coloured alcohols, so to drink wine is to drink something red. What will be interesting to me is how that percentage changes as it becomes a more knowledgeable wine drinking market. The reason this interests me is that to my mind a lot of Chinese food doesn’t actually go that well with wine, and yet in a sophisticated wine market matching food with wine is a common behavior, even if it’s as simple as matching white wine with white meat and red wine with red meat. However, a lot of Chinese food is heavily flavoured and overpowers most wines. At the same time a Chinese meal normally has multiple dishes on the table at one time, of often very different flavours, textures, and meats. Picking a wine to go with such a meal can be a bit of a challenge. There are some obviously successful matches, like Pinot Noir and Beijing Duck, but I would argue that they are the exception rather than the rule. If the Chinese start to make specific matches, like matching Riesling with a Shanghai style fish dish, then perhaps we will start to see the percentage of white wine increase. If however, it all proves a bit difficult, as I have often personally found, then red wine may remain dominant, as a drink that is consumed somewhat separately from local food.

It would also be fair to say that the wine scene is dominated by French wine. This is perhaps understandable given France’s primacy in terms of reputation as a wine producer, but the French have also definitely made a concerted effort to reinforce this. The French expat community in Shanghai for example, is now the second largest only behind the Japanese, and a significant number of them seem to be in some way involved in exporting and marketing wine in China. That being the case, how is Australia doing?

Australian Wine in China

From the get-go it became apparent that we are doing in China what we have seemingly failed to do in places like the UK and US. Excellent Australian wines can be found in the bottle shops and wine bars. Indeed I think the bottle shops in Shanghai have a far better selection of Australian wines than do most London bottle shops. I was in London in May of 2009 and was generally depressed at the crap that represented Australia wine on the shelves of most wine retailers. In contrast, of the 5 or 6 bottle shops I walked into in Shanghai I think there was only one Australia wine that I would classify as a critter wine, while the vast majority were from good Australian producers that I would happily buy in Australia. Cape Mentelle, Dalwhinnie, and Shaw & Smith are examples of wineries that were well represented.

(A somewhat blurry photo of a range of Cape Mentelle wines in a Shanghai bottle shop)

In the couple of wines bars I went into there were similarly good Australian options to choose from. The only place where the selection of Australian wines was less inspiring was unsurprisingly in supermarkets. However, even then it was more a case of shelf space with Penfolds and Jacob’s Creek, which perhaps while less interesting, still represents Australia well in my opinion, as opposed to wines I’ve never heard of with pictures of wombats on the label (of which there were a few, but they were far from prominent).

So Australian wine seems well positioned in China at this early stage of the game, though I didn’t necessarily get the feeling that we are making the concerted effort that the French are. As yet it is by and large an unsophisticated wine market that has a broadly favourable opinion of Australian wine, and is mostly unaware of the criticism of Australian wines for being over oaked, too alcoholic, and lacking personality. In any case if a local in Shanghai has read or heard a bit about this negative view of Australian wines there is every chance they'll find wines that show this stereotype to be a falsehood.

Local Produce

So Australian wines are shaping up well in China, but what of the local produce? Well, if there’s not any Chinese wine in your cellar you needn’t be overly concerned at this stage. It’s not that there isn’t decent wine being produced there, because there is, it’s just that it seems overly expensive and not especially complex at this stage. It’s certainly on the improve, but generally I get the feeling that China is about a decade away from producing wines that you would go out of your way to purchase. That statement, however, needs to be qualified with the acknowledgement that I didn’t get to try nearly as many Chinese wines as I would have liked, the reasons for which I explain below.

The cost of Chinese wines is stunning given their general lack of pedigree and the comparatively low production costs. I’d go into a wine bar, keen to try some local fare, only to end up ordering a glass of Australian wine because it was half the price of the Chinese wine and I knew it to be something I’d enjoy. I did bite the bullet on a couple of occasions and fork out the extra money for a local wine, but was generally a tad disappointed with what was in my glass.

Another issue I found was the lack of tasting opportunities at wine venues. When I visited the Wine Street in Qingdao that I mentioned above, I was quite excited as I thought this might be my opportunity to taste a large range of Chinese wines, even if I had to pay a bit for the tastings. Alas, of the dozen or so stores I went into, not one offered wine by the glass, let alone a free tasting, and all that was offered was to purchase wine by the bottle.

After this unsuccessful effort, we went to the museum on the same street. We had been told that when we got to the end of the museum tour we would get to taste some wine. I assumed it would be something local, instead it was some non-descript Chilean Cabernet!

(While in Qingdao, I also went to the brewery that produces this famous Chinese beer. The brewery has a strong German heritage . . . )

We also inquired about going out to some of the wineries themselves in Shandong province, but it seemed as though one was making a slightly strange request, and that the wineries weren’t really set up to receive visitors. It all seemed a bit too difficult.

I guess this comes back to my original comment that China is as yet an unsophisticated wine market. Most people are buying wines based on apparent reputation and high price tags, and the importance of being able to taste wine before purchasing is not yet appreciated. As such there is very little opportunity to taste a lot of local wine unless you want to buy a bunch of wine at $30 a bottle, $50 a bottle, and a lot higher.

You might question how Chinese wineries selling overpriced wine could be viable, let alone successful, but when you see the number of super wealthy locals paying $1 million for their 2nd Bentley (the tarrifs on imported luxury cars in China are ridiculously high) then paying $50 or $100 for a wine is probably not an issue. Nor for that matter is forking out $10,000 for a rare Bordeaux.

For all this, it became apparent to me from the wines that I did actually try that the quality of Chinese wine had improved since I first tried some examples in 2002 and 2003, and I’ll review an individual wine that I had in a separate post.

All in all an interesting time to visit China from a wine perspective. Their consumers are already starting to make their presence felt in the world of wine, and its hard to see this trend reversing. It’s very conceivable that at some point we will see a Chinese Robert Parker, who through their reviews and taste preferences shapes the way wine is made in certain parts of the world. There’s also no reason not to believe that there aren’t special terroirs in China that won’t produce world class wines that we will all clamour for. In both cases however, I’d suggest that it’s still another decade or two away from occuring.



Chris Plummer said...

Hey, slick post Red, I feel somewhat edumacated about the state of wine in China now - welcome back as well!

Red said...

Thanks Chris. My parents always told me it is important to be edumacated ;-)

Matt said...

Interesting update. I lived in Beijing from 05-09 and would agree with your comments re the development of the retail industry and the generally decent quality of Aussie wine on offer.

In fact the decent quality and highish price of Oz wine pushed me towards Sth African and Sth American wines for daily drinkers. Generally these were great VFM and made me think that Aussie producers had better watch out for these, both here in Australia and in our export markets

Thanks for the post

Red said...

Thanks for the comments Matt. A few mates up there did mention that Chilean wine had become their go to wine because of the value on offer when compared to other imported wines.

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