China

THIS REPOPT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY

Voluntary -

Public Date: 8/19/2009 GAIN Report Number: CH9808

China - Peoples Republic of
Post: Shanghai

ATO

National Wine Market
Report Categories: Wine Approved By: Wayne Batwin Prepared By: Ben B. Sun, with contributions from ATOBeijing, ATO Guangzhou, and ATO Chengdu Report Highlights: Since 2003, the wine market has experienced an average annual growth rate (AAGR) of 17 percent by volume and currently holds a retail value of 7.15 billion dollars. Over the same time period, China’s imported wine market has achieved a 37 percent AAGR, holding a current customs value of $381 million. Overall, 51 percent of wine is sold inthe on-trade sector; the rest sold in the off-trade retail sector. Of retail purchases, 86 percent of bottles purchased were priced below $7 in 2008. Three exporting countries –France, Australia and Chile- comprise 70 percent of the imported wine market, while four domestic companies control 27 percent of the total wine market. The United States ranks fifth in terms of value among countriesexporting wine to China, but is losing market share in a growing market.

Table of Contents
Introduction-------------------------------------------------------------------------- 3 Executive Summary---------------------------------------------------------------- 3 Section I. Market Summary------------------------------------------------------- 4 A. The China WineMarket-------------------------------------------------------- 4 A.1 Current Market Situation------------------------------------------------------ 4 A.2 Domestic Production----------------------------------------------------------- 6 A.3 Import Market------------------------------------------------------------------- 8 B. Consumer Analysis ------------------------------------------------------------ 12 C. Competition--------------------------------------------------------------------- 17 C.1 Leading Domestic Companies------------------------------------------------ 17 C.2 Leading Importing Countries -------------------------------------------- ---- 22 D. Regional Reports---------------------------------------------------------------- 26 Section II. Market Entry and Promotion----------------------------------------- 30 A.Marketing ------------------------------------------------------------------------ 30 A.1 SWOT Analysis ---------------------------------------------------------------- 30 A.2 Keys to Success ---------------------------------------------------------------- 30 A.3 Promoting Wine in “Gan Bei” Culture ------------------------------------- 31 B. Distribution Channels---------------------------------------------------------- 33 C. Entry Methods ------------------------------------------------------------------- 35 D. ATO Marketing Assistance --------------------------------------------------- 36 Section III. Regulations and Taxes ---------------------------------------------- 37 Section IV. Conclusion ------------------------------------------------------------ 37 Section V. Post ContactInformation and Further Information ---------------38 Appendix A: Criteria for Selecting Distributors -------------------------- 39 Appendix B: Standards, Laws, and Regulations ------------------------41 Appendix C: Tariffs --------------------------------------------------------47 Appendix D: SRTG Description and Contact Information ---------------- 48 Appendix E: Exporting Product to China & SendingSamples ----------- 50 Appendix F: Discrepancies ------------------------------------------------ 53

Introduction Other reporting systems in China use the term “wine” in reference to the entire market of fermented fruit alcohol, also including rice wine. In this report, the term “wine” will refer specifically to still grape wine unless otherwise indicated. “Grain-based wines” are commonly...