News / Economy

California Winemakers Target China

California Winemakers Target Chinai
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July 16, 2013 8:27 PM
American wine producers have their eyes on China, where a growing middle class is drinking European and American wines. The United States exported just $74 million in wine to China in 2012, but exports are growing at nearly 20 percent a year. Mike O'Sullivan reports from Napa Valley, California, where vintners hope to see California Cabernets on Chinese dinner tables.
Mike O'Sullivan
American wine producers have their eyes on China, where a growing middle class is drinking wine. The United States exported just $74 million in wine to China in 2012, but exports are growing at nearly 20 percent a year.  Vintners in Napa Valley hope to see California Cabernets on Chinese dinner tables.

Producing Napa Valley wine is a highly skilled craft, and Chinese consumers are developing a taste for it, says Tom Hinde of Yao Family Wines, started by former Chinese basketball star Yao Ming.  

"We've made five vintages together," Hinde said. "Actually, we're working on the 2013 right here.  You can see that these grapes will be ripe sometime this fall, and we get to do it all over again.”

This is a small winery with a high-end product. Hinde strolls through its vineyards in Napa Valley, closely examining clusters of grapes.  He says all are Cabernet Sauvignon grapes, since the Chinese prefer red wine.  The winery's premium cabernet sells for $625 a bottle.

Napa's Black Stallion Winery also looks to China as a promising market, says the winery's Holly Evans.

“Most of our wine is sold here at the winery, although we do have two wines, a Black Stallion Estate Chardonnay and Cabernet, which are sold throughout the United States as well as in China,” she said.

Many moderately priced wines are also exported to China, including some from the San Antonio Winery in Los Angeles.  Fifteen percent of its production goes there.

Linsey Gallagher of The Wine Institute says the group receives constant inquiries.

“About 90 percent of those are coming in about China these days, and so it's a fascinating opportunity in China right now,” she said.

But she says China is a marketing challenge.

“They know a lot of the aspirational, iconic things about California, whether that's Hollywood in Southern California or the Golden Gate Bridge in Northern California or our previous governor, Arnold Schwarzenegger," she said. "By and large, they have no idea that California is the fourth largest wine producing region in the world and makes great quality wines at all price points.”

Winemakers hope to broaden the Chinese palate, and expand the market for fine dry wines, including whites, which are now a small part of the market.

Adam Beak of Bank of the West says the winemakers he works with are competing with European companies, which entered the China market decades ago.

“And they've developed a brand there.  They've developed a name, especially for the French companies on the fine wine side, they're developed a real strong market presence," he said. "The U.S. is still in its infancy.  We're still doing the basic pick and shovel work to get our name out there.”

Yet China's middle class is growing fast, and Tom Hinde of Yao Family Wines is optimistic that more Chinese consumers will develop a taste for imported wine.

“They'll want to drive certain cars, and they'll want to live in certain types of apartments and houses, and they'll want to wear certain clothes and enjoy certain types of wines,” he said.

And he hopes many of those wines will come from California.

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Comment Sorting
Comments
     
by: Yoshi from: Sapporo
July 16, 2013 8:05 PM
So Chinese people already have been enjoyed wine imported from Europe. The challenges for Californian wine seems how it slashes into the marcket with its taste and price advantages.

In Japan, Californian wine as well as Chille and South African wine are recently getting more popular than French or Italian wine becasue they are a bit bitter and cheep.

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