Australian winemakers tempt Chinese palates to secure future

Wed Oct 12, 2011 5:46pm EDT
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By Victoria Thieberger

MELBOURNE (Reuters) - Australian winemakers are setting up replica cellar doors in China and running wine clubs and tastings as they intensify efforts to win Chinese buyers in a bid to offset shrinking demand in their traditional British and U.S. markets.

The wealthy Chinese consumer, with a growing appetite for luxury brands, is the main target for premium winemakers such as Penfolds, which next month will launch a new wine, Special Bin 620, in Shanghai.

"We have never done a global launch like this outside of Australia before," says Penfolds' global brand manager, Sandy Mayo. Bin 620 will sell in the same price range as Penfolds Grange Hermitage, widely considered Australia's best wine, at more than A$550 ($548) per bottle.

China has become the biggest market for Australian wine priced at more than A$10 ($9.95) a liter, a remarkable shift as Chinese tastes for imported wines grow. China imported more than $1 billion worth of wine last year, up 61 percent from the year before.

Chinese imports in the A$10-plus range almost equalled those of the U.S. and UK markets combined, according to data from government agency Wine Australia, selling in restaurants, hotels and gourmet supermarkets.

Australia's bottled exports to China grew 32 percent to A$190 million in 2010, while exports to the United States fell 20 percent and to the UK slumped 33 percent, hurt by a robust Australian dollar.

"Australian wines are gaining more and more popularity as they are mostly full of fruit and soft flavors and there is a lot of 'flavour for your money' as we say," said Espen Harbitz, who runs the Australian-owned restaurant Capital M in Beijing.

But the latest figures also show Australia has lost significant market share to France, which has long been the dominant player in Chinese bottled wine imports after pioneering efforts in the 1980s.   Continued...

<p>A wine critic smells red wine during the Chateau Haut Brion wine-tasting event in Beijing, in this file picture taken April 18, 2007. REUTERS/Claro Cortes IV</p>