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August 29 2010
Why it pays to have a fat wallet when exploring the world of
vintage wine By Felix Salmon
You probably know, or think you know, that fine wine gets better with age. But
how do you know that? It is probably not by tasting a large number of fine wines
of various vintages. Instead, you are just taking it on trust, often from the
kind of wine snobs who will sniff and swirl and spit a wine, but now swallow it,
and declare with all the puffed-up authority they can muster that it will be
"drinking well from 2017 through 2027".
Such proclamations tend to be extremely unhelpful except for people who aspire
to become wine snobs. Even if wine really does get better with age, you can only
benefit from being told such things if you can a) find the wine now; b) afford
to buy it without drinking it; c) store it indefinitely in
temperature-controlled conditions; and d) somehow be able to cross-reference
your wine collection with a database that tells you when the perfect drinking
years roll around so the wine isn't forgotten. Fine old wine is drunk every day,
by people who are happy that it has been ageing for a decade or two. But for
every bottle that fits that description, there is another bottle that has been
gathering dust for far too long.
If it is drinkable at all, it is flat, uninspired, and likely to taste of
nothing in particular, especially after 10 minutes in contact with air. There
are millions of these bottles, all of which should really have been drunk years
ago, and many of which are being treasured by owners who have delayed
gratification for so long that it has disappeared entirely.
Meanwhile, the world of vintage wine is becoming more out of reach for the
middle-class, with fine Burgundy and Bordeaux now an international commodity
beloved of wine investment funds. No longer can such wines be bought for
relatively modest prices when young, with the expectation that they would
appreciate just as modestly over time.
Once upon a time, colleges, clubs and restaurants would barely change over
decades, and would happily replenish the old wine they were drinking with new
wine they intended to drink in many years' time. Something similar would take
place within families: wine-loving patriarchs would drink the bottles bought by
their fathers and grandfathers, while building up their own collection for their
sons and grandsons.
But we are living in an increasingly high-velocity world, where clubs and
restaurants and hotels come and go quickly. They haven't had the opportunity to
build up a spectacular cellar.
But the financial realities are even more important. Few of us have the good
fortune to be able to drink bottles bought in the 1960s, '70s, or '80s by our
fathers or grandfathers - but even when we do, we feel that we need to do so in
a special, ceremonious way, if only because those bottles, if they are any good
at all, are now so valuable.
Only a fraction of all wine produced globally will age well over 20 years or
more. That tiny fraction of the world's wine has appreciated enormously in
price, even when it's brand new. To drink vintage wine on a regular basis, you
have to be able to afford to replace it with the same wine from the most recent
vintage. That was something middle-class wine lovers could do, back in the '70s
and '80s; it's almost impossible now.
At the same time, the quality of wine that won't age well has improved
immeasurably over the past 30 years. A technological wine-making revolution that
began in Australia has since swept the world, to the point at which even the
cheapest wines are much better than their counterparts of a few decades ago.
Back in the 1970s, the choice between cheap California jug wine and good French
Bordeaux was an easy one. The French wine was significantly better and still
affordable while the cheap wine tended to be far too sweet.
Today, entry-level mass-produced wines like Yellowtail or Ecco Domani are
eminently drinkable and for the same price or just a couple of dollars more it's
possible to find excellent wines from France, Spain, Chile and other countries.
That first-growth Bordeaux, by contrast, is utterly out of reach: only
millionaires can afford to drink it daily.
It used to make a lot of sense for many people to drink half the wine they
bought and lay down the rest. But almost none of the wine that most of us buy
and drink is going to get any better with age.
The problem is that winemakers and wine retailers are loathe to admit it,
because they know that the ability to age well is universally perceived as a
sign of quality.
It can be a lot of fun to drink older wine, if you don't have too much
emotionally or financially invested in it. Recently I poured a 1998 Chianti down
the drain without regret: I bought it cheap and the gamble didn't pay off. But
it's very hard to throw away wine with nonchalance when you've paid US$50,
US$150 or even US$500 for it.
So if you find a wine that you love, drink it. If you want to start exploring
the world of older wines, make sure you have a fat wallet and expect to run into
some very expensive disappointments along the way.
August 23 2010
Uncorked: tickled pink
By Debra Meiburg
Pink bubbles suffer from stereotyping. When Jacob's Creek sparkling rose won the
trophy for the best wine to serve with braised abalone at last year's Cathay
Pacific (SEHK: 0293) Hong Kong International Wine & Spirit Competition, it
caught the judges by surprise. While in Argentina this spring, I was startled to
see men order sparkling rose with meals. At a recent champagne seminar, it was
interesting to note most attendees expected the rose to be the cheapest of all
the non-vintage sparklers, but, in fact, it's one of the most expensive. Clearly
we have preconceived ideas about pink bubbles, not only on price and prestige
but when, where and with what it should be sipped.
As part one of a two-part series on sparkling roses, what follows is an array of
pink bubblies from Spain and Italy. Pop the corks on these wines and reveal some
surprising truths.
 Segura Viudas, Lavit Rosado Cava Brut,
Spain
Coral with cranberry hues. Earthy and flinty with toasty and yeasty notes. Soft,
round bubbles. Red summer fruits emerge on palate. Well put together with
classic old-world character. Excellent food match and great value.
Available for HK$98 at Watson's Wine Cellar (tel: 2606 8828)
Bonomi Tenuta Castellino Franciacorta Rose, Italy
Pale coral tones with orange glints. Delicate strawberry fruit, tea-leaf and
floral jasmine notes. Soft sparkle and crisp acidity. Well made and tightly knit
with a solid fruit core and that elusive feature: finesse. Pretty and elegant,
serve this wine as a reception aperitif.
Available for HK$300 at Advantage Asia Pacific (tel: 2499 1110)
Premium Brut Rose Fontanafredda NV, Italy
Medium coral hues. Fresh vibrant raspberry and yellow cherries with floral
notes. Though bubbly, its forthright character makes it easy to drink alongside
a still (non-sparkling) rose. Lovely and fresh fruit with leesy, toasty notes.
Well-layered.
Available for HK$138 at Castello del Vino (tel: 2866 0577)
Noche Y Dia, Cava Brut Rose, Spain
Robust fruit (in the context of bubblies), layered red berries, toastiness,
orange and tangerine hints. Savoury nose with characteristic cava earthiness.
Full-bodied with well-balanced acidity and buoyant bubbles. The tannic texture
is a touch dishevelled, which keeps it out of the top class, but well worth
buying. Could be served with light meats.
Available for HK$140 at Bacchus Fine Wines (Asia) (tel: 2415 8968)
Carpene Malvolti Rose Cuvee Brut NV, Italy
Bright pink-toned coral with exuberant, forward fruit. Aromatic raspberry,
strawberry and rhubarb with lemon biscuit underpinning. Soft sparkle. Texture is
slightly tannic leaving the wine a touch ragged, so best served with food.
Excellent outdoor wine.
Available for HK$138 at Castello del Vino (tel: 2866 0577)
August 8 2010
US wineries seek growing Chinese market
Hong Kong and the Chinese mainland are developing a strong thirst for wine, and
Washington and Oregon are hoping for a taste of those growing markets.
So far, only a trickle of Northwest wines make it to Asian countries outside of
Japan. But experts say as affluence grows in China's booming economy, so will
the demand for the finer things in life.
The recession hurt US wine sales to most of the world last year, but not to Hong
Kong, where the value of American wine imports jumped 138 percent to $40
million.
Most of that vino came from California, which accounts for about 90 percent of
the US's total wine exports. But the value of Washington's shipments to Hong
Kong grew more than fivefold.
Washington's larger wineries have long cultivated customers in the Chinese
mainland and Hong Kong, and smaller exporters are seeking a foothold. Earlier
this year, a delegation from Washington and Oregon signed a deal to promote
wines in Hong Kong, their first trade agreement with that city.
"For our region, it's about being present, and you win by being there," said Al
Portney, vice president of international sales for Ste. Michelle Wine Estates,
which has been exporting wine to Hong Kong and the mainland for years.
Portney said the Woodinville, Washington, winery pursues a methodical and
long-term strategy showing that Northwest wines are high quality yet affordable.
While Ste. Michelle's exports to the region can fill a container on a cargo
ship, Jonathan Ryweck, a one-man exporter of three Washington labels, ships a
few pallets at a time.
"This is not a get-rich scheme, let me tell you," Ryweck said of his Port
Townsend company, Transnational Ventures Inc. "It's growing very nicely but it's
still real small volume and it's a tough sell."
Still, the Chinese associate foreign wine with success, education and status, he
said.
"The Chinese love the taste profile of Washington wines," Ryweck said. "If you
can get the product in their mouth, you can sell it."
Hong Kong's wine imports have soared since it eliminated an 80 percent excise
tax in 2008. The US Department of Agriculture says it imported a record $491
million of wine last year. Most came from France, but the US accounts for 8
percent of those imports.
Hong Kong is now the fourth-largest export market for US wines behind Canada,
the European Union and Japan, and it's a major re-exporter to the Chinese
mainland and other points.
Last year Washington exported about $9.7 million in wine, but just $721,000 to
Hong Kong and $414,000 to the mainland, according to figures from Global Trade
Information Services Inc cited by the state Agriculture Department. Exports to
Hong Kong jumped 529 percent, however.
Figures for Oregon are sketchier, but the USDA says in 2009 the state exported
1,355 cases to Asia outside of Japan and South Korea. That's minuscule compared
with the 1.6 million cases its wineries shipped in the US.
Most Oregon wineries are family affairs that sell domestically, said Katie Bray,
Oregon Wine Board export manager. A small but eager group is interested in
exports, and China has great potential, she said, but the board's limited
promotional money is focused on the major foreign markets: Japan, the United
Kingdom and Canada.
Watson's Wine Cellar, Hong Kong's largest specialty wine chain, does sell
Oregon's Erath and Argyle wines, however.
"All of a sudden there's an interest in Northwest wines," said Argyle winemaker
Rollin Soles. His Willamette Valley winery produces 40,000 to 45,000 cases a
year and has shipped about 200 cases to Hong Kong's largest specialty wine
chain, Watson's Wine Cellar, in the past six months.
He sends only his top wines — putting the "best foot forward" to build the
region's reputation.
Chinese on the mainland drink about 75 million cases of wine a year, said
Richard Halstead, chief operating officer of the British consultancy Wine
Intelligence Ltd. But 90 percent is domestically produced wine "that most wine
consumers in other countries would struggle to recognize as the product they
drink," he said.
Foreign sellers need to guide new consumers on types of wines and how they
taste, Halstead said.
"Chinese consumers are confused by wine," he said in an e-mail. "This is hardly
surprising: most Western consumers are, too, and they don't have to deal with a
totally alien script when trying to decipher what's on the label."
Wine Intelligence estimates the number of Chinese who drink imported wine —
those that can part with $20 or more for a bottle — will grow to about 50
million in 15 years, nearly the number in the US who now drink imports.
The average salary in China's urban areas is $356 a month, according to the
latest figures from China's National Bureau of Statistics. But the country's new
affluence is staggering, and the desire for wine is rapidly spreading beyond the
big cities, Portney said.
He and Ryweck see similarities with this country. The US had a "hard liquor and
beer culture" until World War II, when GIs brought a taste for wine home from
Europe, Ryweck said. By the 1970s, there were countless good domestic and
imported wines on store shelves.
Millions of Chinese work or study overseas and bring home what they learn,
Ryweck said. "They're changing Chinese society and part of that is wine
culture."
June 17 2010
Where the Wine Is?
 John Kapon, President and Auction
Director, Acker Merrall & Condit, presides over Acker Merrall's latest auction
in Hong Kong last month
The “fantastic strength” of the Asian market for fine and rare wines was left in
no doubt at the record-breaking May auction held by Acker Merrall & Condit. The
largest wine auction in the region, and the second-biggest worldwide, drew
Asia’s most serious collectors to Hong Kong.
The auction of The Imperial Cellar, a legendary single cellar owned by US
collector Eric Greenberg, fetched US$19.5 million, with 97.3 per cent of the
lots sold. Acker Merrall & Condit President and Auction Director John Kapon said
the 28-29 May sale far exceeded expectations.
Beyond Thrilled
“We are beyond thrilled with the results of this record sale, with many lots
selling well above their estimated value,” Mr Kapon said.
“We had over 400 clients registered for the auction room alone, with hundreds of
others participating live online and via absentee bid, indicating the fantastic
strength of the Asian market for fine and rare wines. Owners of fine cellars
around the world now understand that there is a keen demand for rare wines among
buyers in Asia, and especially in China.”
 The top lot of
Henri Jayer Vosne Romanée Cros Parantoux realized HK$1.95 million, a new world
auction record, at AM&C’s latest sale in Hong Kong He added that the region’s
professional wine collectors gathered in the saleroom to participate in spirited
bidding. They were rivaled by absentee bidders from around the world who used
the phone and the Internet to compete for most of the lots. “The majority of
buyers, however, were from Asia and, particularly, Hong Kong, with strong
participation by Chinese mainland buyers.”
Acker Merrall & Condit held its debut sale in Hong Kong in May 2008, followed by
two more that first year. Four successful auctions were held in 2009, and six
are scheduled for 2010.
Mr Kapon said the Hong Kong Government’s abolition of wine duties “absolutely”
influenced the wine merchant’s decision to bring business to Hong Kong. “The
taxes were unusually high, and the fact that we don’t have those now puts a lot
of energy into the market.”
The growth rate has been exponential since. In 2008, Mr Kapon said, Hong Kong
accounted for 25 per cent of the firm’s global auction sales. In 2009, it was 50
per cent, and the estimate for this year is 75 per cent. “We definitely hadn’t
forecast growth on such a scale,” he said.
Acker Merrall is banking on continued growth, with plans to open its first Hong
Kong retail store as early as next year. “This is a two-way street. I hope the
traffic continues to move in both directions for many years to come.”
Château Margaux Arrives
 Paul Pontallier, Château Margaux
Managing Director (right), and his son, Hong Kong-based brand ambassador
Thibault Pontallier, in Beijing last month According to the International Wine
and Spirits Record (IWSR), the mainland imported more than 10 million cases of
still wine last year, a 50 per cent increase over 2008, with France the largest
supplier. “Wealthy Chinese are investing in expensive wines, with Hong Kong
auctions of fine wines now becoming more important than those in London,” IWSR
Magazine editor Alex Smith told the Financial Times newspaper.
The trend has caught the eye of prestigious Bordeaux winery Château Margaux,
which has sent one of its top people to Hong Kong. In April, Thibault Pontallier,
son of Château Margaux Managing Director Paul Pontallier, moved to Hong Kong,
where he will spend at least two years as the brand’s ambassador.
Château Margaux first identified Greater China as an emerging market in 2006,
when Mr Pontallier senior led an eight-day promotional tour of China. Thibault
Pontallier said there were compelling reasons for the company’s recent
establishment in Hong Kong.
 Château Margaux is one of Bordeaux’s
most famous vineyards “Five years ago, we were selling only a few cases in Asia.
But the growth rate has been very fast. Today, China accounts for about 20 per
cent of our sales,” he said.
Mr Pontallier is in Hong Kong to build
relations, organise presentations and host wine dinners. He said he was
pleasantly surprised at the wine culture in Hong Kong, where so many young
people are drinking wine – “almost more than in France” – and said his presence
has been well-received. “People love to see someone from Bordeaux coming to
visit them in Hong Kong.
“Hong Kong has a central position in the region, and the absence of duties has
made it the wine hub of Asia. I meet so many people in the wine business here
every day, who agree that that’s why they need to be in Hong Kong.” Mr
Pontallier added that, if he were a wine merchant today, “I’d say you definitely
need to have someone in Hong Kong.”
Record Crowds
 Record crowds attended last month’s
Vinexpo Asia Pacific 2010, held in Hong Kong “Asia is now the most dynamic and
happening market in the wine and spirits world,” said Robert Beynat, Chief
Executive of Vinexpo Asia-Pacific, which staged its latest show in Hong Kong
last month.
Attendance at Vinexpo Asia Pacific 2010, held at the Hong Kong Convention and
Exhibition Centre, 26-28 May, was up 40 per cent compared to the last show, two
years ago. The three-day event drew 880 exhibitors from 32 countries, and
attracted about 12,000 visitors. Exhibitors came from almost every
wine-producing region in the world. The increase in visitors, according to Mr
Beynat, reflected burgeoning wine consumption in Asia, which is “increasing four
times faster than the world average and is expected to continue in the next five
years.”
June 13 2010
Hong Kong (overtake USA) the toast of the wine auction world
By Dennis Eng
 Hong Kong is likely to overtake the
United States as the world's biggest wine auction centre this year with sales of
about US$100 million.
This comes two years after duty on wine was scrapped in the city and will help
cement its position as a global player for wine auctions.
First-half results show wine sales of more than HK$400 (US$51.30) million -
exceeding the record US$50.7 million global sales achieved in the whole of last
year by 2009 leader Zachys.
Wine consultant David Wainwright, formerly with Christie's international wine
department, said Hong Kong would probably surpass the US if wine sales in the
second half of the year matched the first half. Given the robust demand for fine
wines in Asia and on the mainland, he said Hong Kong would continue to lead the
global wine auction market for at least five years.
The US wine market suffered a 36 per cent drop to US$106.05 million last year
with New York sales falling one-third to US$72.38 million. Total global sales
fell to US$233.35 million from US$276 million in 2008.
Wainwright said part of Hong Kong's meteoric ascent up the ranks of global wine
sales comes at the expense of the US as major auction houses such as Sotheby's
and Acker Merrall & Condit shift more of their wine stocks - that would have
been sold in the US - to Hong Kong in the hope of achieving higher prices.
This has the effect of boosting Hong Kong sales and also buoying prices in the
US because of less competition among auction houses in New York. New York-based
Acker Merrall is expected to derive three-quarters of its total revenue from its
six Hong Kong sales this year.
"I do not think it is the auction houses but rather the consignors themselves
that are requesting Hong Kong," Acker Merrall president John Kapon said. "There
is an aura about China and its developing market that many want to try
first-hand. However, I would not underestimate the interest that remains in fine
wine in the rest of the world."
In Hong Kong, Sotheby's kicked off the year with a January auction that achieved
HK$52.9 million, its highest total for a one-day sale. Acker Merrall followed
with a two-day sale of HK$59 million. A Zachys sale in February fetched just
over HK$52 million, Acker Merrall returned in March and realized HK$57.6 million
before taking home over HK$152 million last month, the second biggest wine
auction in the world. Another Acker Merrall sale in New York that fetched
US$24.68 million in October 2006 holds the world record.
Christie's had a HK$40.3 million sale, its biggest in Asia, and Sotheby's a
HK$20.66 million sale.
Law of averages makes Bordeaux futures a good bet - Great vintages are common,
but exchange rates are a worry By Robert Whitley
 The 2009 Bordeaux futures will be
expensive, and with the price pressure likely to be asserted by the emerging
Chinese wine market, perhaps artificially so.
It may come as a surprise to those who don't live and die by the scores of
famous wine critic Robert Parker that vintages of the century are rather common
in Bordeaux, where the most collectible and thus the most expensive wines in the
world are produced. Since the harvest of 2000, we've had three. I kid you not.
It isn't clear whether the phrase was first uttered in jest or, more likely, to
promote sales within the Bordeaux wine trade. What's important to know is that
when, on those rare occasions, the Bordelais harvest fully ripened grapes, they
are likely to celebrate another "vintage of the century". So as the grapes were
gathered in the fall of 2009, they partied like it was 2005. Something akin to
what happened in 2005, when they partied like it was 2000.
It is a vicious cycle for anyone who collects or invests in Bordeaux, for it
inevitably means a price spike is on its way. To soften the blow, serious wine
collectors and merchants with deep pockets often purchase Bordeaux en primeurs,
using what are commonly called Bordeaux futures.
The buyer thus enters into a contract to purchase the latest vintage of Bordeaux
at the earliest (and theoretically the lowest) price for delivery of the wine in
two to three years.
As the price tends to rise on a great vintage between the time futures are
offered and the wines reach our shores, historically they've been a good
investment. In a normal world, 2009 would be no exception. Bordeaux from this
vintage is outstanding across the board.
Still, I'm not certain futures are the best bet in collectible Bordeaux at this
time.
First of all, it appears the emerging Chinese wine market is eager to
participate. Evidence of that surfaced in March, when the 2009 Bordeaux Primeurs
were on display for a full week of tastings from the barrel.
A record 6,000 members of the trade and press attended, and the Chinese
contingent matched the US delegation, coming second in size only to the group
from Britain.
The Chinese had been indifferent to Bordeaux futures in the past. Increased
competition for a limited resource should drive up the price.
The 2009 Bordeaux futures will be expensive, and with the price pressure likely
to be asserted by the Chinese, perhaps artificially so.
More troubling, however, is the cloud hanging over the future of the euro, and
the distinct possibility that it could be worth far less two years from now than
it is today.
Can an investment in '09 Bordeaux today be prudent when the wines might actually
be cheaper upon release in two years? That's a tough call. If you believe the
dollar will continue to be weak or that hyperinflation in the United States is
likely, then Bordeaux futures could be a good hedge.
Bottom line, though, nobody knows.
It is with this air of global economic uncertainty that wine collectors will be
tempted to purchase some of the most hyped and expensive wines ever made.
I'm simply not going to take the bait. My strategy for the '09 Bordeaux vintage
is simple. I will get my Bordeaux fix, but I will avoid top growths such as
Latour, Mouton and Cheval Blanc in favor of less sexy wines from less well-known
chateaux.
The vintage was so good that I know I will find attractive wines with excellent
ageing potential, particularly from the Left Bank.
The districts of Margaux, Pauillac, Saint-Julien, Saint-Estephe and Graves all
produced superb wines.
Many of the lesser lights made wines as good as any they have ever made, but
they lack the star power to command huge price increases.
And with some of the dollars I might have spent on the top growths, I will sort
through the better wines from the more lightly regarded vintages of 2006, 2007
and 2008. A great vintage always has the effect of suppressing prices for lesser
vintages immediately before and after.
A good example of that was the superb 1983 vintage that followed the legendary
vintage of 1982. As good as the '83 vintage was, prices never reached the level
of the coveted wines from 1982. Same thing happened with the outstanding vintage
of 2001 following the enormously hyped 2000 vintage.
There were good wines made in '06, '07 and '08 and I intend to make it my
mission to find them and, if all else fails, I will merely wait until the next
vintage of the century and cross my fingers that the dollar has inched past the
euro in value.
Knowing what I do about the history of Bordeaux, I have a hunch it won't be much
of a wait.
Robert Whitley is the publisher and managing partner of wine website Wine Review
Online, www.winereviewonline.com,
and the host of an online radio show "Whitley on Wine". He also oversees several
international wine competition.
May 28 2010
Dynasty eyes vineyards in New World regions
 Customers choosing wines at a
supermarket in Zhengzhou, Henan province. Wine consumption in China is expected
to reach 900 million liters by 2013 compared with 675 million liters in 2008.
Dynasty Fine Wines Group Ltd, part-owned by France's second-biggest liquor
company, may spend almost $150 million to boost capacity by 43 percent to meet
rising demand in China.
The Tianjin-based company may buy vineyards in Australia, New Zealand, Chile or
France and has 1 billion yuan ($146 million) in cash, Chairman Bai Zhisheng said
in an interview on Tuesday. Dynasty wants to raise production to 100,000 metric
tons annually within three years, from 70,000 metric tons now, he said.
"There are only a few available locations for vineyards in China," Bai said. The
company is looking mostly to New World wine regions because they "have different
harvesting seasons and that complements our production schedule as well."
The executive estimates "double-digit" sales growth this year, driven by demand
in China, where rising household incomes are boosting wine consumption. China is
on track to become the world's seventh-largest wine market by 2013, according to
a study by the Vinexpo Asia-Pacific industry exhibition and market researcher
International Wine and Spirit Record.
"China is still a relatively young market for wines, and consumers are just
starting to enjoy them," Bai said. "Demand is fast-growing and the market
potential is huge."
Dynasty is also surveying potential assets in France, attracted to the country's
quality grape vintages and varieties, Bai said.
China production
Dynasty, which is 27 percent owned by Remy Cointreau SA, is also looking to
expand wine production in the world's fastest-growing major economy.
Chinese output of the beverage is about 1 million metric tons a year, meeting a
fraction of demand, Bai said.
Dynasty estimates domestic demand for wine will rise 10 percent this year.
Consumption may increase to 900 million liters in 2013 from 675 million liters
in 2008, according to the Vinexpo/IWSR study. Red wines account for 88 percent
of all wines consumed in China, the study showed.
Dynasty rose 3.7 percent to HK$2.80 in Hong Kong on Wednesday. The stock has
risen 11 percent this year, compared with a 12 percent decline in the benchmark
Hang Seng Index.
The company typically invests between 100 million yuan and 200 million yuan a
year to expand and capital spending will remain steady during the next three
years, Bai said.
Net income in 2009 rose 9.1 percent to HK$156.1 million ($20 million) and sales
gained 8.9 percent to HK$1.48 billion, according to a March 31 company filing to
the stock exchange.
China is the world's fastest-growing wine market, said Dominique
Heriard-Dubreuil, chairwoman of Vinexpo Overseas.
"There is an overall trend of drinking more wines and they want to be part of
the trend," she said. "The market is growing in all dimensions and sophisticated
consumption is part of it."
Still, beer and local white liquor, known as "baijiu" and produced by companies
including Kweichow Moutai Co, will remain the most popular alcoholic beverages
in China, Bai said.
Dynasty exports small volumes of its output to about 10 countries globally,
including the US, France, Italy, Japan, the Philippines and Singapore, Bai said.
The company also supplies Chinese embassies overseas, he said.
"I want the best quality of the old world vintages and the production scale of
the new world wines," Bai said. "I want people overseas to taste Chinese wines."
May 27, 2010
Mainland China winemaker aims for a top drop - One of China's few female
winemakers is creating French-style reds that are surprising even the experts
By Mark Graham
 Experts who taste wine from the Silver
Heights estate usually nod with approval, expressing surprise that a small
winery in Ningxia province can produce such a smooth drop. When they discover
who the winemaker is - a young Chinese woman little known in the industry - they
are amazed.
 Emma Gao Yuan, one of the few female
winemakers on the mainland, is creating French-style reds that are on the wine
lists of five-star Aman resorts in China, alongside grand crus such as the 1982
Chateau Lafite, priced at HK$66,000.
"I had heard of Emma Gao, so I ordered the wine to try and was very impressed,"
says Crystal Edgar, cellar master for Aman resorts in Asia. "I think it has
incredible potential; the wines have depth and complexity, real structure,
balance and muscle."
Little Emma and her cousin help harvest the grapes at Silver Heights estate
Making the Aman wine list is no small feat for a fledgling producer. The only
other Chinese wines offered at the group's luxury retreats in Beijing and
Hangzhou are from the Hong Kong-owned Grace Vineyard, the long-established
Changyu Castel and an ice wine from Golden Valley Vineyards.
Wine is becoming an increasingly popular tipple on the mainland, especially
among the newly-affluent younger generation. Wine-industry group Vinexpo - which
is holding its Asia-Pacific expo in Hong Kong this week - says consumption of
imported wines is growing at 65 per cent a year, and in three years, some 17
million cases will be imported annually.
"In terms of overall growth in demand for wine in China over the next 10 years,
China will become both a massive producer and a massive importer of wine," says
Don St Pierre, head of ASC, the wine importer and distributor recently acquired
by Japanese drinks giant Suntory.
In the grand scheme of mainland wine production, Gao's operation is modest, but
of the more than 400 wineries scattered across the nation, Silver Heights
produces some of the very best wine.
But it comes with major sacrifices for Gao. She is separated for long stretches
from her husband, Thierry Courtade, and five-year-old daughter, also called
Emma. Both live in France, where Courtade is the winemaker at Chateau Calon
Segur.
Grapes being sorted at Silver Heights estate
"I miss her very much," says Gao of her daughter. "She is tough, the same
character as me! We talk via webcam and I go to France at least once a year to
visit and spend two or three months with her ... we paint, read, cook and play
together.
"I am used to the simple life here on the vineyard. I grew up with no television
and only went out once a week. But I do love to go to Shanghai and Beijing to
meet people."
For Gao, winemaking has become a passion, but it was a career path that came
about by chance. The local government, keen for locals to learn more about wine
production, targeted three people for crash-course training at the
world-renowned wine college in Bordeaux, France. French-speaking Gao's role with
the delegation was primarily as a translator, but she became intrigued by
winemaking and decided to stay on for further study.
"My father encouraged me to go and learn the technical side of winemaking,"
recalls Gao, 33. "He worked in administration with a state winery and told me
that our region has the potential to produce good wine. After studying in France
for six months, I hadn't learned very much but wanted to go back to study more."
Gao applied to study at the Ecole d'Oenologie in Bordeaux; there were 300
candidates for 30 places that year, she says, but she was accepted.
"During the vacations I stayed in France and did an internship in a chateau. I
really wanted to understand. I did all kinds of work, even inside the tanks. It
was very tough work ... the smell of alcohol can be overpowering at times."
On her return to China six years ago, Gao worked as a freelance winemaker before
joining Torres, the Spanish producer-distributor, to learn the business side of
winemaking.
During that time, Gao and her father developed the Silver Heights estate and
made their first wine, which they hesitantly offered to Torres executives
Alberto Fernandez and Damien Shee for tasting. "She asked us if we would like to
try the wine and when we did it was fantastic. I believe it is one of the top
wines in China," says Shee. "We realised this was a serious winemaker who we
should encourage. We helped her with the labelling, packaging and distribution.
The wine promotes itself... wait until 2008 vintage is released, there is just
one word to describe it - amazing."
Buoyed by her bosses' praise, Gao left the company to concentrate on her own
wines. Torres now distributes the two Silver Heights wines, as it does for Grace
Vineyard, another independent winery known for the quality of its wines.
Even the boutique, Hong Kong-owned Grace is a large operation compared with
Silver Heights. The vines occupy just two hectares of land on the slopes of
Mount Helan; initial production was in one tank, which allowed production of
only 3,000 bottles for the first two vintages. The addition of a second
fermenting tank has allowed production of 6,000 bottles for the 2008 vintage.
Silver Heights makes just two red wines, both a blend of cabernet sauvignon,
cabernet franc and cabernet germischt grapes; the terroir where they are grown
leads to different characteristics. The Summit, which sells for HK$350 a bottle,
is made from grapes grown on slate-like earth with some clay, while grapes for
the Family Reserve, which retails at HK$230, are sourced from vines near a
river, where the ground is stonier.
The Summit is a favourite of Aman's cellar master. "We showcased this wine,
among a few other local wines, to several top wine producers from California and
they were impressed," says Edgar.
The province of Ningxia is hardly renowned for winemaking - the Shandong
peninsula is home to most major wineries - but the region around Silver Heights
has the right conditions and climate for making top-notch reds. "We are
surrounded by mountains, which break the wind and stop the erosion," says Gao.
"We also get a regular supply of water for irrigation from the melting snow and
3,200 hours of sunshine a year.
"At the winery we do everything ourselves. Me and my father look after the
wines, my mother is the analyst and my sister is the accountant. We do almost
everything by hand ... bottling and labelling.
"My ambition is perhaps to buy another vineyard; we are looking for investors
but we are not in a hurry. They have to be investors who love wine. I would like
to be a consultant for many wineries in China and help raise the standard of
wine here."
No land of Lafite, but it's still early days
While the quality of China-made wine, and the range of imported options, has
improved enormously in recent years, it remains at a dismally low level.
Vague regulations on content labelling often make it difficult to establish the
provenance of locally made wines, while imported bottles are subject to swinging
tax rates. Nonetheless, there is general industry agreement that the future
looks bright: among the major wine-world names taking the market seriously is
the renowned DBR Chateau Lafite, which has set up a winery with the mainland
investment arm, Citic.
The winery is near the town of Penglai, on the Shandong peninsula, a region that
hosts almost 50 wineries. The highly rated Grace Vineyard lies further west, in
Shanxi province, with Silver Heights winery in the even farther-flung Ningxia
province.
"It is still very early days - the industry is undergoing amazing growth," says
Hong Kong-raised Marcus Ford, who runs an upmarket wine bar and retail outlet,
Pudao, the Wine Way, in Shanghai. "There is a lot more competition, lots of
opportunities and lots of challenges. People in China are experimenting more.
"There is tons of rubbish out there. Good progress has been made by people like
Emma Gao, and Grace Vineyard, who have invested in quality, but a lot of Chinese
wine is still pretty poor and poorly regulated."
May 25 2010
China drives world wine market - The Fourth Asian Vinexpo Show HK May 25 - 27
2010
http://www.vinexpo.com/fr/index/
The fourth Asian Vinexpo featuring 840 exhibitors from 32 countries opened on
Tuesday in Hong Kong as the global economic crisis pushed exporters to focus on
the world’s most promising market: China.
 Huang Yaqiang, executive director of
Dynasty Fine Wines Group poses for a picture at VINEXPO Asia-Pacific in Hong
Kong on May 25, 2010.
“A little like last year vintage Bordeux, this Vinexpo is exceptional. There are
more exhibitors and we expect more than 10,000 professionals, including a large
number from China,” said chief executive Robert Beynat.
The annual wine and spirits fair is key to Hong Kong’s bid to turn itself into a
wine trading centre that sits on the doorstep of the vast Asian market with
Chinese consumers showing a growing demand for foreign products.
French wines occupy almost half the 8,500 square metre site, confirming their
place as a favorite among Chinese consumers.
A model displays wine from China at VINEXPO Asia-Pacific in Hong Kong on May 25,
2010.
“China and Hong Kong are the most dynamic Asian markets with per capita
consumption rising and strong import growth [8.7 million cases in 2008],” Beynat
said.
“European and US producers are turning towards these markets to recover from the
[economic] crisis.”
Italian, Spanish and German wines round out Europe’s offering at the fair, with
the US doubling the number of its exhibitors and Australian and New Zealand
vintners boosting their presence by 30 per cent.
Asia-Pacific accounts for 50.6 per cent of world spirits consumption with an
expected 4.7 per cent increase between last year and 2013.
Although Japan remains the region’s biggest wine importer, China will have
nearly caught up in the next three years, according to Vinexpo.
China is expected to be the world’s seventh-largest wine consumer by 2013, it
said.
“There are 100 to 150 million people in China who can afford to drink wine. It
is these people, and not only millionaires, that we must reach,” said Alain
Vironneau, president of the Bordeaux Wine Council.
Added Beynat: “Our challenge is to explain to Chinese consumers that there are
good wines at all prices and they’re not reserved just for the elite”.
Visitors attend the VINEXPO Asia-Pacific in Hong Kong on May 25, 2010. The
fourth Asian Vinexpo featuring 840 exhibitors from 32 countries opened in Hong
Kong as the global economic crisis pushed exporters to focus on the world's most
promising market: China. 'A little like 2009 vintage Bordeux, this Vinexpo is
exceptional. There are more exhibitors and we expect more than 10,000
professionals, including a large number from China,' said chief executive Robert
Beynat.
Hong Kong is becoming a "Wine hub", an inevitable place in Asia for the wine
trade, which should, according to the estimates of the specialists, rise from
4,75 billions US$ in 2006 to 6,36 billions US$ in 2011.
Hong Kong (HKSAR) - Following is the speech by the Financial Secretary, Mr John
C Tsang, at the opening ceremony of Vinexpo Asia-Pacific at the Hong Kong
Convention and Exhibition Centre today (May 25): Dominiqe, Marc,
Distinguished Guests, Ladies and Gentlemen, Hello and Bonjour. I am delighted to
join you today for the opening ceremony of this year's Vinexpo.First of all, a
very special welcome to those of you who have traveled long distances and come
to Hong Kong from different parts of the world. Hong Kong is greatly privileged
to be the host of the Vinexpo Asia-Pacific for the fourth time.
And, just like a good wine, it continues to mature and it continues to improve.
This year's event is the largest so far, with more than 840 exhibitors from 32
countries. The number of Pacific-based exhibitors has increased by 30 percent
compared to 2008.
This is a clear vote of confidence for Hong Kong as a wine trading and wine
distribution hub in the region. When Hong Kong last hosted the Vinexpo in May
2008, we had just exempted duties on wine. This move has proved to be a winner
forour wine industry, even though we do not produce a single grape here.
Over the past two years, we have seen robust growth in wine-related business.The
value of our total wine imports increased 80 percent year-on-year in 2008, and a
further 45 percent last year reaching almost US$600 million. Also, since
February 2008, Hong Kong has hosted 27 wine auctions, with sales fetching a
total of more than US$130 million. We have even leapfrogged London to become the
world's second largest wine auction centre, next to New York.
Riding on the synergy created by Vinexpo, as many as four world-renowned auction
houses are holding wine sales here in the last 10 days of May. Many more wine
companies have set up or expanded their business in Hong Kong to tap the growing
opportunities. Over 150 new companies have been established here since the duty
exemption in 2008.
These companies have created jobs, opportunities and wealth-and all this during
a difficult time with the global crisis. We are pleased with the way things have
gone for our wine trade over the past couple of years, but we could not have
done it without all of you-our partners in promoting wine enterprise. In August
2008, we signed our first wine co-operation agreement.
It was with France-our largest wine importer. Since then, we have entered into
similar agreements with eight more countries and regions, most recently the
Amercian states of Oregon and Washington. We will also sign a supplemental
agreement with Bordeaux later today.
And more such agreements are in the pipeline. Closer to home, the Mainland of
China is an increasingly important wine market for everyone. According to a
recent Vinexpo study, consumption of imported wines in the Mainland is forecast
to grow by more than 60 percent between 2009 and 2013, relative to the preceding
five years.
As a premier international gateway to the Mainland, Hong Kong is well placed to
capitalise on this market growth. We have been pulling out the stops to
encourage wine traders to establish a base in Hong Kong for selling wines to
Mainland customers. We recently reached an agreement with Mainland Customs that
would facilitate the movement of¡@Mainland-bound wines handled by Hong Kong
companies.
Registration started last week and the scheme is expected to begin operation
next month. So find out as soon as how this can benefit your business. We have
also launched a certification scheme for companies whose high-quality wine
storage facilities meet certain international standards.
So far, nine local companies have received certification with more applications
being processed. Ladies and Gentlemen, Hong Kong is a place where you can buy,
sell, store, transport and taste the world¡¦s best wines. Vinexpo Asia-Pacific
brings all these elements of the wine trade-and much more-together under one
roof.
Please make full use of this event and this city as a platform to showcase your
merchandise, and connect with likeminded people from the Mainland and from
around the region. Also Let me mention also the Hong Kong Wine and Dine
Festival, which will be held here again for the second time in October this
year. Don't miss it! Finally, I wish the Vinexpo Asia-Pacific another vintage
year in Asia's world city.
Thank you very much.
May 24 2010
Hong Kong's thirst for wine increases
Hongkongers drank 1.4 million more bottles of wine last year than in 2008, amid
cheaper prices and the removal of the wine duty, an annual survey shows.
The lure of more affordable alcohol, coupled with a booming fine wine auction
business, was responsible for the increase in wine consumption. Last year, more
than 10 million bottles of wine were sold in Hong Kong, up 16 per cent by volume
and 11 per cent by value, according to the Nielsen Co survey.
The government scrapped its 40 per cent duty on wine in 2008.
"In 2009, we have seen an obvious price polarization within the wine categories,
with a stronger skew towards wines priced below HK$130 per bottle. This segment
has outgrown premium wines in the past year with its volume increasing 21 per
cent. This phenomenon echoes back to the sentiment of frugal consumers during
the first half of 2009," Oliver Rust, managing director of the Nielsen Co Hong
Kong, said.
Price comparisons show the average price per bottle last year was 12.30 per cent
cheaper than in 2007.
Given continuing improvements in the local economy this year, the demand for
wine was expected to remain robust, Rust said.
The consumption of red wine by volume jumped 16 per cent last year, compared
with the year before, with Australian and American vintages responsible for much
of the growth. Sales of white wine, mostly from New Zealand and Chile, grew 12
per cent while sparkling wines rose 7 per cent.
Rust also pointed to the strong emerging trend of wine being purchased as gifts
for family and friends during festive seasons.
Almost one-third of annual wine sales took place during over the Lunar New Year
holiday and Christmas, the survey found.
The findings are based on weekly data compiled by major supermarkets, drug
stores and convenience stores.
May 17 2010
 Hong Kong and USA signs MOU to
promote wine related cooperation
A memorandum to expand cooperation in wine related business between Hong Kong
and the United Stated was signed here in Hong Kong on Monday.
The Secretary for Commerce and Economic Development Rita Lau signed the
Memorandum of Understanding on Co-operation in Wine- related Businesses (MOU)
with the visiting Secretary of Commerce of the United States Gary Locke.
"Today, our relationship with the U.S. takes another major step forward. Riding
on this MOU, we will strengthen our joint efforts on promoting wine-related
trading, tourism, investment and education," Lau said.
The MOU also covers a number of special areas, including promoting wine
alongside regional and local cuisine, facilitating the organization of wine
auctions in Hong Kong for US wines, and encouraging the provision of quality
wine storage facilities in Hong Kong.
Locke said the MOU was a contribution to the National Export Initiative, which
aimed to double American export by 2015. The agreement would help more American
wine from all 50 states to Hong Kong consumers.
As one of the world's leading wine producers and exporters, the United States is
Hong Kong's fourth largest wine provider. Wine imports from the United States
amounted to 49 million U.S. dollars in 2009-2010, representing a five-fold
increase since Hong Kong's duty exemption. The U.S. auction houses have also
held regular wine auctions in Hong Kong with record-breaking sales on several
occasions.
The MOU on wine between Hong Kong and the United States is the eighth
co-operative agreement concluded by Hong Kong with wine producing
countries/regions, coming after those with France, Bordeaux, Spain, Australia,
Italy, Hungary and New Zealand.
Drinking Business
 US Secretary of Commerce Gary Locke
(second from left) toasts the signing of a US-Hong Kong wine MOU with Secretary
for Commerce and Economic Development Rita Lau (second from right), along with
Permanent Secretary for Commerce and Economic Development (Commerce, Industry
and Tourism) Yvonne Choi, and US Consul General Stephen M Young
The United States has become the latest country to strike a wine deal with Hong
Kong. US Secretary of Commerce Gary Locke signed a memorandum of understanding
on Co-operation in Wine-related Businesses with Hong Kong Secretary for Commerce
and Economic Development Rita Lau during the HKTDC event.
“Riding on this MOU, we will strengthen our joint efforts on promoting
wine-related trading, tourism, investment and education,” Mrs Lau said. “We look
forward to tasting the fruits that this MOU will bring,” she added.
Wine imports from the US, Hong Kong’s fourth-largest wine importer, amounted to
US$49 million in 2009-2010, a five-fold increase since Hong Kong removed duties
on wine in February 2008.
April 25 2010
Hong Kong and Mainland
Sign Agreement on Customs Facilitation Measures for Wine
Hong Kong and the Mainland today (February 9) signed a co-operation agreement on
customs facilitation measures for wine entering the Mainland market through Hong
Kong.
Hong Kong Financial Secretary, Mr. John C. Tsang, Hong Kong Secretary for
Commerce and Economic Development, Mrs. Rita Lau, and Hong Kong Permanent
Secretary for Commerce and Economic Development (Commerce, Industry and
Tourism), Miss Yvonne Choi, witnessed the signing of the co-operation agreement
by the Hong Kong Commissioner of Customs and Excise, Mr. Richard Yuen, and the
Vice Minister of the General Administration of Customs, Mr. Sun Yibiao.
Speaking at the signing ceremony, Mrs. Lau said that against the backdrop of
growing demand for wine on the Mainland, Hong Kong’s zero wine duty policy and
favorable business environment helped create room for wine traders in the
territory to tap the Mainland market. She also made reference to the large
number of Mainland tourists visiting the city, who might buy in Hong Kong fine
wines from different parts of the world.
She said that the signing of the agreement would enhance co-operation between
the Hong Kong and Mainland Customs on wine-related matters, and fortify Hong
Kong’s position as a regional wine trading and distribution hub.
“We are very grateful to the General Administration of Customs for their
support. The measures to be put in place will help enhance transparency and
certainty in doing business, thus facilitating Hong Kong's wine traders who wish
to expand their operations on the Mainland,” Mrs. Lau said.
The facilitation measures are open to registered traders. The Trade and Industry
Department (TID) will handle registration for Hong Kong traders while the
Mainland Customs will deal with the registration of Mainland traders.
Participation in the registration scheme is voluntary.
Companies that have been set up in Hong Kong for no less than six months and are
engaged in wine-related businesses (such as trading, storage and logistics) are
eligible to seek registration.
The gist of the facilitation measures is as follows:
(a) pre-valuation of wine duty: registered wine traders may request Mainland
Customs to do valuation of wine duty 10 working days before the shipment is
exported from Hong Kong to the Mainland. When the shipment arrives at a Mainland
boundary point, Mainland Customs will normally complete the procedure within one
working day; and
(b) expediting the clearance process at Mainland ports: for registered wine
traders who do not choose to make use of the wine duty pre-valuation service,
Mainland Customs will strive to shorten the clearance time at the Mainland
boundary points. For wines which have been imported into the Mainland before,
with the submission of all the necessary documents, the clearance procedure will
normally take no more than three working days. For wines which are new to the
Mainland market, the clearance procedures will usually be completed within seven
working days. If customs clearance cannot be completed within the said
timeframe, the goods may still be released for sale on payment of a guarantee
deposit. This enables traders to sell their wines as soon as possible.
The governments on the two sides will publish the list of registered traders
respectively on their websites. Both the TID and Mainland Customs will also set
up their own hotlines to answer enquiries from wine traders about details of the
facilitation measures. Registered traders may also directly contact Mainland
Customs through its hotline if their wine shipments encounter customs clearance
problems on the Mainland.
The TID will announce details of the registration scheme through circulars and
briefings later.
The facilitation measures are due to be implemented as a pilot in Shenzhen in
the second quarter of this year. After trying out the measures for six to nine
months, the two sides will review the situation and consider extending the
scheme in phases to other major Mainland cities such as Shanghai, Guangzhou and
Beijing.
Footnote:
As you may already be aware, the global demand for wine is shifting from
traditional wine consumption markets, like Europe and the US, to Asia. Strong
economic growth, increased prosperity and changes in lifestyle, have led to a
dramatic increase in demand for wine, particularly in Mainland China. Wine sales
in Mainland China shot up by more than 65% between 2001 and 2006. The industry
expects a further 40% growth by 2011.
Meanwhile, the Hong Kong SAR Government’s decision to cut wine duty to zero in
February 2008 has been a major boost to Hong Kong’s bid to be Asia’s wine hub.
The industry response to the elimination of wine duty has been rapid. Hong
Kong’s strategic location, at the heart of Asia and gateway to Mainland China,
has attracted numerous wine companies to use Hong Kong as their regional
distribution hub. Hong Kong’s world-class infrastructure and logistics allows
Hong Kong-based wine dealers to supply their wholesale clients in Asia with
“just-in-time” efficiency. We see new business opportunities in wine re-exports
and retail; wine storage and distribution; wine marketing, exhibition and
tourism; wine education; wine accreditation and wine investment.
FYI attached please find an announcement on the signing of a co-operation
agreement on customs facilitation measures for wine entering the Mainland China
market through Hong Kong.
Asian Buyers' Competitive Spirit has Turned Hong Kong into a Major Wine Hub Much
Faster than Traders Expected, Writes Ben Sin SCMP, 19 January 2010
- Sotheby's - Hong Kong has become its most important centre for fine wines
- Local and mainland buyers accounted for 40 percent of Sotheby's total wine
sales
- Last year Asian Collectors overtook the US in the purchase of fine wine at
auctions
- Asian buyers in general have been what's driving the sales
- Hong Kong has become a portal for mainland buyers who want to avoid duties
April 25 2010
 Lafite sets heady wine rally pace -
Accelerating Chinese demand boosts prices - By Guy Collins
Like art, wine investments also seem to be recovering from the depths of the
recession. And Chateau Lafite Rothschild, the largest of Bordeaux's first-growth
wine estates, is outpacing rivals as prices rebound from credit-crunch lows,
driven by signs of economic recovery and accelerating demand from China. Three
cases of Lafite Rothschild from the 2000 vintage sold for HK$266,200 each at
Sotheby's in Hong Kong this month, about three times the US$11,749 for 12
bottles of the same wine at a New York auction at the height of the financial
crisis in October 2008, just after Lehman Brothers Holdings filed for
bankruptcy.
The London-based Liv-ex 100 Fine Wine Index, which lost 22 per cent of its value
between August and December 2008 as the banking collapse hit wine investment
along with other asset classes, has rebounded 27.6 per cent over the past 12
months. Demand for top wines, along with buying fuelled by collectors in Asia,
has driven gains among most Bordeaux first growths, with Lafite setting the
pace. "Lafite is still taking the lead role and is making other wines look
extremely cheap," said Miles Davis, a partner of London-based Wine Asset
Managers, which has a total of about US$20 million under management in two wine
funds. "Demand from Asia is enormous." While many investors focus on the 2000
vintage, described by Christie's International senior wine consultant Michael
Broadbent in his book Wine Vintages as the best for Bordeaux reds since 1990,
Lafite's rally is also evident for other standout years such as 1996 and 1986,
as well as the landmark 1982 vintage. Two cases of Lafite 1986 sold for £14,950
(HK$178,700) and £13,800 at Bonhams in London on March 26, up from £7,130
fetched at a Sotheby's auction in London on April 22 last year.
A study by William Beck of Wine Asset Managers, published last year and
analysing price trends over more than a decade, showed that on a compound annual
growth rate basis, Lafite 1996 rose 17 per cent each year between January 2001
and January last year, while Lafite 2000 gained 21 per cent. That outstripped
rival Medoc first-growth Chateau Margaux, which rose 11 per cent and 14 per cent
respectively over the same period. As for the 1982 vintage, Lafite surged 26 per
cent a year over the eight-year period, more than triple rival Chateau Mouton
Rothschild, which rose just 8 per cent a year. Part of the explanation lies in
Chinese demand. While US and European collectors have traditionally bought
Lafite and other top Bordeaux to lay down in cellars for 15 or 20 years before
selling it on or consuming it, Asian buyers are drinking it younger. That both
pushes up demand for newer vintages and reduces supplies of older ones. The
US$34,300 achieved for Lafite 2000 in Hong Kong on April 3 compared with
US$27,225 paid for each of two cases of the same Lafite vintage sold at
Sotheby's in New York on March 20. At the Hong Kong sale, Lafite had to compete
with its Bordeaux right-bank rival Chateau Petrus, whose smaller production adds
rarity value to its prices. Three lots of 12 bottles from the 2000 Petrus
vintage fetched US$49,900 each at the sale. "The very extreme price
differentials are almost certainly going to unwind in time," said James Miles, a
co-founder of Liv-ex, adding that "it's still very much about Hong Kong and
China". Lafite, owned by the Barons de Rothschild, has 107 hectares of vineyards
and over the past decade has produced an average 45,000 cases a year, including
both the Chateau Lafite Rothschild flagship wine and its second wine, Carruades
de Lafite.
The 1982 vintage has risen more steeply in price than others, as the wine is
drunk and starts to run out. Data from Wine Asset Managers shows that a case of
Lafite 1982, released at £300 in 1983, rose more than tenfold to trade at £3,400
by 2000 and now sells for more than £25,000. Five bottles of 1982 Lafite sold at
Sotheby's in London on March 17 for £12,075. The annual presentation to the
world wine trade of the new Bordeaux vintage took place last month, focusing
attention on the futures market and also the wider range of wines on offer from
the region. Mouton, Chateau Haut-Brion, Chateau Margaux and Chateau Petrus are
all seeing an expansion in demand, according to the Liv-ex market report for
March. "There have already been some signs that the market is starting to
broaden out," Miles said.
April 23 2010
 Share Class of 2009 -
Would you be able to tell which of the new Bordeaux will gain the most value?
Last week, I wrote about the best wines from the 2009 vintage that I sampled at
the Bordeaux en primeur (wine futures) tastings, which took place earlier this
month. This annual event sees buyers from all around the world descend on
Bordeaux in France to taste the new vintage, whose grapes were picked, pressed
and fermented only months before, and which are still ageing in their barrels.
It takes some skill to taste these wines and predict what they'll be like in a
year or two, after they've been bottled and released. But it gives buyers the
opportunity to secure an allotment for some wines with large demand but limited
supply.
Not everyone buys these wines solely for quality - some people see them as an
investment. Bordeaux prices are usually at their lowest when purchased en
primeur; the price goes up once the wines are bottled, and if you buy a top
vintage (as this 2009 seems to be), the wines can fetch top dollar many years
down the line. The en primeur release price of the 2008 vintage of first growth
Chateau Lafite Rothschild and Mouton Rothschild has already risen by close to 80
per cent, and these wines won't be bottled for another year.
The wines I'm recommending for investment purposes are a mix of the recognisable,
big names (which always sell well), and up-and-coming chateaux. In this second
category, the 2008 en primeur prices show zero or little increase on their
prices now, but are likely to sell for more when bottled next year.
Chateau Lafite Rothschild, Pauillac (first growth)
This wine has more than proved its worth as an investment over the past few
years - even during the financial collapse of September 2008, its dip was more
shallow and its rise faster than any other wine. According to trading company
Liv-ex, the average rise of Lafite for all vintages from 2000, measured by the
difference between the initial price and then three years later, stands at 54
per cent. The "second wine" (using grapes considered not perfect enough for the
main wine) from the same property, Carruades de Lafite, has proved even more
successful (a staggering 133 per cent rise over three years), and the 2009 is
likely to be no different.
2008 release price (all prices refer to a case of 12) £3,590 (HK$42,700), now
£6,000
Chateau Mouton Rothschild, Pauillac (first growth)
Rumours suggest that Mouton Rothschild is due to follow Lafite in terms of price
rises. The average rise over three years since the 2000 vintage has been 17.9
per cent, but this is relatively modest and offers plenty of room for
development. Mouton shares the Rothschild name (the two properties are owned by
cousins, but have no direct connection), which is now an international symbol of
luxury. A Chinese artist is reportedly due to create the 2008 label (the
identity of the artist will only be revealed when it is bottled next year).
2008 release price £1,790, now £3,200
Chateau Haut Brion, Pessac Leognan (first growth)
Haut Brion is the most difficult of the first growths to taste en primeur, as
the wine can be notoriously subtle at this stage. Perhaps this is why its price
rises have been slower on the secondary market (17.7 per cent average over three
years). But this could be good news for the 2009 vintage, Nick Pegna, director
of Berry Bros & Rudd Hong Kong, thinks. "New investors tend to follow the crowd,
but the more savvy and seasoned, of which there are plenty in Hong Kong, look at
other things such as pricing and performance over a number of years. On that
scale, Haut Brion starts to look substantially undervalued."
2008 release price £1,860, now £2,500
Chateau Petrus, Pomerol
Now vinified by Olivier Berrouet, who has taken over from his father,
Jean-Claude, this 100 per cent merlot has amazing exuberance in 2009, but all
tightly controlled, with pure fruit and softly worked tannins. Always one of the
most sought-after wines in Bordeaux, and priced accordingly. Investment
potential certainly, but only for the lucky few.
2008 release price £15,000, now £20,000
Chateau Cos d'Estournel, St Estephe
This wine, from director Jean-Guillaume Prats, has been subject to serious
investment over recent years, and now boasts a spectacular steel-and-glass
winery. Its style was divisive at the 2009 en primeurs, with some critics
claiming it was too modern. But division creates interest, so you can expect it
to start making waves on the auction circuit.
2008 release price £765, now £765
Chateau Smith Haut Lafitte, Pessac Leognan
A wine that is making an increasing impact on the Chinese market, owned by
Daniel and Florence Cathiard. Overall, the Pessac Leognan wines performed very
strongly in 2009 (this is the same appellation as first growth Haut Brion, so in
theory should offer investors plenty of potential). This might be the year that
they really come into their own.
2008 release price £350, now £360
Chateau Palmer, Margaux
Merlot grapes have been planted on gravelly (typically used for cabernet
sauvignon) terroir at this Margaux chateau since before the second world war,
which goes a long way to explaining the balance of elegance and delicacy with
power and exotic sumptuousness. Palmer has long had a loyal, smart following,
and is a safe investment. A great year for the second wine Alter Ego, also.
2008 release price £999, now £1,176
Chateau Angelus, St Emilion
Another wine that has captured the imagination of the Chinese market in recent
years, and with good reason - it has plenty of personality, with its high
percentage (47 per cent) of the cabernet franc grape. It is also visually very
striking (its distinctive label graced the James Bond film, Casino Royale) and
owners Jean Bernard Grenie and Hubert de Bouard are regular visitors to Asia.
2008 release price £720, now £720
Chateau Lynch Bages, Pauillac
Lynch Bages has a huge following in Asia, and continues to be interesting for
investors. The 2009 is a supremely confident wine that will need time to develop
- perfect for cellaring. The average rise of this chateau for vintages from
2000, measured again from the initial price and three years on, is a healthy
23.7 per cent.
2008 release price £360, now £465
Chateau Beychevelle, St Julien
The St Julien appellation was probably the most consistent across Bordeaux in
the 2009 vintage. Beychevelle has developed a steady reputation, and this looks
set to continue. It's not likely to offer spectacular rewards, but will
certainly offer steady ones, and it's a safe bet (average of 17 per cent returns
over three years). 2008 release price £264, now £270
Jane Anson is the Bordeaux correspondent for Decanter magazine, and author of
the Bordeaux chapters of Opus Vino (to be published in October 2010, Dorling
Kindersley)
April 3 2010
 Wine investment yields high returns,
withstands tough times By Leslie Gevirtz
Investing in wine, not just top Bordeaux from great vintages but even cheap
varieties, could be good for your portfolio and is especially useful during a
financial crisis, according to a new study.
"Wine in a portfolio has produced higher returns and lower risks than the
Russell 3000 equity index ... Especially in times of economic downturns,"
economists Philippe Masset, of Lausanne Hotel School, and Jean-Philippe
Weisskopf, of the University of Fribourg, both in Switzerland, told the American
Association of Wine Economists.
Their study comes as auction houses reported holding sales of fine wines
totalling more than US$12 million in the last two weeks.
The pair looked at auction hammer prices from The Chicago Wine Company from
January 1996 through January 2009. They accumulated data from 144 auctions with
a turnover exceeding US$237 million and covered a period that included two
significant economic booms, 1996-2001 and 2003-2007, as well as the two most
recent major financial downturns, 2001-2003 and 2007-2009.
They then created a General Wine Index (GWI) and other indices that tracked
different price categories as well as ones that followed five major wine
regions. The GWI and the Russell 3000, which measures the performance of 3,000
publicly held US companies, both rose between 1996 and 1998. But while the
Russell 3000 declined between 2001 and 2003, when the internet bubble burst, the
GWI steadily rose.
"Neither the terrorist attacks in New York, nor the burst of the internet bubble
nor the boycott of French goods after the Iraq invasion have had much effect on
wine prices," the authors said. From 2005 to 2008, the GWI doubled. Since
mid-2008, it has fallen 17 per cent as a result of the global financial crisis.
Meanwhile, the Russell 3000 index lost 47 per cent in the same period.
The economists also found that wine had a more positive effect, with a lower
amount of risk, on investment portfolios than stocks. Wines selling below US$200
a bottle steadily increased over the 13-year period and yielded a return of 120
per cent, while those selling for under US$100 a bottle, which are considered
cheap in the world of wine auctions, generated a 170 per cent return.
Wines selling for more than US$200 and especially those over US$400 a bottle,
such as Chateau Lafite or Haut-Brion, had a three-to-four-fold price increase.
These wines also suffered the most declines during the financial crisis, losing
about 25 per cent. Wines under US$200 a bottle lost between 5 and 10 per cent
during that time.
The pair also created model portfolios mimicking the broad categories of
investors from conservative to aggressive and found that no matter the investing
style, allotting 20 per cent of a portfolio to wine had a positive effect on
performance.
March 28 2010
Banker toasts a HK$2.5m (US$324,678)
thirst for Chateau Lafite
 Private banker Timothy Lo has splashed out
a record HK$2.56 million for a collection of French wine dating back four
centuries.
Auctioneer Acker Merrall & Condit said the price was an auction world record for
a single lot of 70 bottles of Chateau Lafite Rothschild, featuring vintages aged
from 1799 to 2003.
Lo said he had been a dedicated wine collector and drinker for more than 20
years and the Lafite was one of his favourites. "It was there, it was in my
budget, so I bought it," he said.
Lo said he was thrilled with his purchase and was looking forward to drinking
them with friends - at least those bottled within the last 30 years.
Yesterday's Lafite splurge was not the only purchase made by the managing
director of French private bank CIC Investor Services; he and one of his
mainland friends spent HK$6 million to HK$7 million between them at yesterday's
auction, but who's counting?
And anyway, he said, the wine was secondary to those you chose to drink it with.
"Wine is just the companion. It's the friends that are important," he said.
Lo said about 70 per cent of the buyers at the auction at the Island Shangri-La
were from the mainland.
"Lafite is the most famous wine in mainland China. From my friend's point of
view, wine is reasonably priced in Hong Kong, because the tax is more than 70
per cent on the mainland," he said. "He can come here and take a few bottles
back each time."
Acker Merrall & Condit's auction director John Kapon said HK$57.6 million was
spent during the two-day auction.
March 13 2010
China became the top importer
of the world's most famous red outside of Europe, taking over from the US for
the first time this year.
The West's thirst for fine wine may be entering a period of moderation, but
China's cup runneth over, to the relief of vintners in Bordeaux. China became
the top importer of the world's most famous red outside of Europe, taking over
from the US for the first time this year. With overall wine exports down 23 per
cent in 2009, producers are looking East to empty their cellars. Alain Vironneau,
president of Bordeaux's wine trade body, said China was its first client outside
the European Union. China's buying power comes at a particularly opportune
moment as France's leading wine region struggles to survive the economic crisis.
"The crisis that the wine sector is going through is tied directly to the
economic crisis," Vironneau said. "Several hundred vineyards are in peril due to
insufficient cash," Despite a slight increase in export sales over the past
three months, Vironneau said 2009 had been "catastrophic" for the region, and
any recent sales activity fell short of making up for a year of losses.
Bordeaux exported 206 million
bottles last year, generating €1.29 billion (HK$13.76 billion). This was a 14
per cent drop in volume, and a 23 per cent decrease in value. The hardest hit
markets were some of Bordeaux's most trusted - the US, Britain and Belgium,
which dropped by 44 per cent, 33 per cent and 16 per cent, respectively.
Nicholas Pegna, managing director of Berry Bros & Rudd's Hong Kong operations,
said north Asian markets were very much in the driving seat. Five or six years
ago, the company allocated about 25 per cent of its en primeur offering of
Bordeaux, or wine futures, to Hong Kong and greater China. This has risen to
more than 50 per cent this year. Pegna said Bordeaux had been the starting point
for fine wine drinkers for a long time. "While people first come to Bordeaux,
and go farther out to Burgundy and others, it's not a lily pad where they hop
off to the next one and never come back. Many people go through that journey
without losing their love for Bordeaux." While the US still outpaces China in
terms of value, at €139 million, it slipped to No 5 position in volume,
surpassed by China. Last year sales to China increased by 40 per cent to €74
million, with volume increasing by 97 per cent. Sales to Hong Kong, helped by
the elimination of import duties in 2008, increased by 46 per cent to €109
million, with a 24 per cent increase in volume.
Wine specialists in Hong Kong
attribute Bordeaux's success in the region to a blend of cachet and having the
volume of production to take advantage of an emerging market. "Bordeauxs are
like the LVs, the Guccis of wine," said Charlene Dawes of Tastings, a wine bar
in Central. "A lot of people give Bordeaux as a gift. It's about face. If you're
going to give a bottle of wine, if you want people to know that it's is
expensive, then people will choose a Bordeaux."
March 10 2010
Fast-tracked Wine - Hong Kong
Portugal’s Sogrape Vinhos set up its Asian
base in Hong Kong about two years ago to distribute the company’s brands in the
region, including the fast-growing Chinese mainland market.
“We have no doubts that the potential [of the mainland market] is enormous,”
said Filipe Carvalho, Managing Director of Sogrape Group (IW Hong Kong Ltd).
“China is definitely a growth market for us, although there is a long way to go
in terms of distribution, consumption habits and wine education.”
Mr Carvalho said exporting wines to the mainland “has been quite demanding and
complex because, many times, customs requirements are not consistent and change
frequently.”
That will soon change under an agreement between Hong Kong and the mainland that
will make it easier for Hong Kong-based traders to export wine into the
mainland.
 Filipe Carvalho,
Managing Director, Sogrape Vinhos (IW Hong Kong Ltd)
 More wines from
Portugal’s Sogrape’s vineyards in Quinta do Seixo in Douro Valley are likely
bound for the Chinese mainland, thanks to the new customs facilitation scheme
for Hong Kong-based exporters
Traders to Benefit
“The measures to be put in place will help enhance transparency and certainty in
doing business, thus facilitating Hong Kong’s wine traders who wish to expand
their operations on the mainland,’” said Rita Lau, Hong Kong Secretary for
Commerce and Economic Development. The moves, she said, are part of efforts to
strengthen Hong Kong’s position as the regions’ wine trading and distribution
hub.
 Hong Kong Commissioner
of Customs and Excise Richard Yuen (front row, left) and Vice Minister of the
General Administration of Customs Sun Yibiao sign a cooperation agreement on
customs facilitation measures, witnessed by Hong Kong and Chinese mainland
officials, including Hong Kong Financial Secretary John Tsang (centre) and Hong
Kong Secretary for Commerce and Economic Development Rita Lau (third from left)
The new measures, to be introduced in the second quarter of the year, are open
to registered traders. Companies that have been set up in Hong Kong for at least
six months and are engaged in wine-related businesses, including trading,
storage and logistics, are eligible to register.
Currently, it could take several weeks for wine shipments to clear mainland
customs and quarantine procedures. Under the plan, registered traders can ask
mainland customs to conduct a duty valuation 10 working days before the shipment
leaves Hong Kong. Mainland customs authorities would normally complete the
procedures within one working day of the shipment arriving at a mainland
boundary point.
For registered traders who choose not to use the pre-valuation service, mainland
customs, under the agreement, would strive to shorten the clearance time at the
boundary point. Wines that have been imported into the mainland before will
normally take no more than three working days to clear, with submission of the
necessary documents. Wines new to the mainland, meanwhile, would be processed
within seven working days. And if customs clearance is not completed within the
timeframe, the goods may still be released with a deposit, to allow the wines to
go on the market as soon as possible.
“This measure will definitely make the export process from Hong Kong to the
mainland more transparent,” said Mr Carvalho. “It will give more confidence to
our partners when importing from Hong Kong.”
Another Step in the Ladder
Canadian wine distributor Portfolio Wine and Spirits Inc, which is eyeing the
mainland market, also welcomed the move. Leo Baduria, who manages the company’s
Hong Kong-based retail shop Wines to Go, said the measures will help the
company’s expansion plans into the mainland.
“The government has provided another step in the ladder for the local wine
industry to develop,” said Gregory De’eb, Managing Director of Crown Wine
Cellars, Hong Kong’s first fine-wine storage facility. “It provides clarity of
the mainland system that’s desperately needed for small exporters unable to
establish a strong line.”
Hong Kong Business Leaders: Wine Specialist Gregory de'Eb
http://www.youtube.com/watch?v=VWE8j46j0MU
Mr De’eb believes that the move will mainly benefit rare and fine-wine
exporters. “It locks down the time lines and input process for fine wines to go
into China,” he noted.
A clear and transparent system, he said, would avoid delays that could put
shipments at risk. “If it’s sitting in improper conditions, you stand to lose
the whole shipment.
“It’s great not only for fine-wine exporters but for mainland consumers, because
it will raise the quality of wine available on the mainland market. And that,
for someone who’s as passionate about wine as me, is good news.”
Asia’s Wine Hub
The agreement, signed last month, is the latest effort to develop Hong Kong as a
regional wine hub following the abolition of wine duties in 2008. The value of
wine imports soared 80 per cent that year from 2007, and increased another 41
per cent year-on-year in 2009. The mainland’s wine imports are projected to grow
to as much as US$870 million by 2017, representing 58 per cent of the Asian
market, excluding Japan.
The government said it would continue exploring new measures to help the trade
make further inroads into the mainland market.
“We will also continue to discuss with the relevant mainland authorities in
mapping out possible facilitation measures on the quarantine side,” said
Assistant Secretary for Commerce and Economic Development Aubrey Fung.
Shenzhen will be the testing ground for the new customs facilitation scheme.
After a review of the measures six to nine months after its introduction, the
scheme may be extended in phases to other major mainland cities, including
Shanghai, Guangzhou and Beijing.
"Not only has Hong Kong consolidated its position as the regional hub for fine
and rare wines, it is continuing to claim its rightful place on the world wine
stage." - John Kapon, President, Acker Merrall & Condit
Fine Wine Centre
Hong Kong’s fine wine market continues to sizzle, based on results of several
key wine auctions held earlier this year. Sotheby’s first Hong Kong wine auction
of the year, in January, realised a total of US$6.7 million. Among the
highlights was a six-litre bottle of Chateau Lafite 1982, which fetched
US$46,700. The 10-hour sale of more than 800 lots saw strong bidding from buyers
throughout Greater China, Sotheby’s said.
Acker Merrall & Condit’s first auction of the year, held last month, achieved
even higher results, raking in US$7.6 million. Two cases of Chateau Petrus 1982
sold for US$88,041 each.
“The excellent result sends a very clear message,” said John Kapon, Acker
Merrall & Condit’s President and Auction Director. “The wine market in Hong Kong
is extremely robust. Not only has Hong Kong consolidated its position as the
regional hub for fine and rare wines, it is continuing to claim its rightful
place on the world wine stage.”
Last year, Hong Kong overtook London as the world’s second largest wine-auction
centre, after New York. But Mr Kapon believes the city will go on to take the
top spot. “We predict that in 2010, Hong Kong will go further and become the
world’s leading wine auction centre.”
Wine on the Run
It’s the start of the afternoon rush hour at the Mong Kok East Rail station in
Kowloon, where commuters catch the cross-border train to the Chinese mainland.
An eye-catching shop offering an array of wine prompts some to drop in and have
a look. Others take time to sample the wines on offer.
“Wines to Go was set up in a user-friendly fashion, to bring a fresh and
exciting selection of fine wines from around the world to Hong Kong,” says Leo
Baduria, the Canadian entrepreneur behind the concept.
Launched last December, Wines to Go is the first licensed shop to open at Hong
Kong’s Mass Transit Railway (MTR). According to Mr Baduria, the store’s open
layout is designed to be inviting, to encourage people to browse.
 Leo Baduria,
President of Wines to Go (left) and Pok Man Wong toast the recent opening of
their new retail wine shop
No Château Lafite Here
 Wine is featured in a
user-friendly fashion, based on style and taste profiles
“Our goal is to open up the market to wines other than Bordeaux, and to let
consumers discover other quality wines at competitive prices,” he says. Bordeaux
wines are on offer, but you won’t find one well-regarded brand in China on the
shelves.
“We get a lot of traffic from Chinese mainland travellers, who often ask if the
shop carries Château Lafite,” Mr Baduria said. The shop gets the question so
frequently that a sign now hangs in the shop telling customers: “We don’t carry
Château Lafite, but we have fine-quality Bordeaux.” Mr Baduria says he hopes the
retail concept will help change the Chinese mindset of wine as a luxury product,
that they will instead buy wine for the pure pleasure of it.
Wines to Go is designed to resemble a mini-showroom, with wine featured based on
their style and taste profiles. Prices range from HK$100 to HK$950.
There is a chilled-wine section for customers on their way to a party, or for
those who just want to pick up a bottle for dinner. A gift section, featuring
products to enhance wine appreciation, including wine cellars, is also on offer.
Wines to Go is the first licensed shop to open at Hong Kong’s mass transit rail
system
 An MTR commuter stops
for a taste test at Wines to Go
Mr Baduria, a veteran wine importer and distributor in Toronto, likens the Hong
Kong market to Toronto’s 20 years ago. “It was young people who started setting
the standards by frequenting or setting up wine bars and restaurants,” he
recalls. “That’s the approach we want to take here. We want the young people to
be more adventurous.”
The Canadian entrepreneur says he had been looking into the Asian market for
seven years before deciding on Hong Kong. In 2006, Mr Baduria started to
actively explore opening the first Wines to Go for its parent company,
Toronto-based Portfolio Wine & Spirits, Inc, in Hong Kong. He came up with the
retail concept as “the best way to make wine more accessible.”
Mr Baduria says he would have loved to introduce his retail concept in his
hometown, but was put off by Canada’s restrictive laws to regulate the wine
business. Hong Kong, on the other hand, he says, offered the perfect setup:
“It’s a virgin market with a huge growth potential.”
Market to Explode
An MTR commuter stops for a taste test at Wines to Go
 Wines to Go is the
first licensed shop to open at Hong Kong’s mass transit rail system
Mr Baduria says he has high hopes for the region overall. “The Asian market is
going to explode in 10 to 15 years’ time; there’s nowhere else where it’s
growing like it is here – certainly not North America, which is a mature
market.”
The company plans to open stores on Hong Kong Island later this year, and has
its sights on the mainland market. It has recruited Pok Man Wong, a long-time
wine professional, to introduce the retail concept there. Mr Wong, who has
worked at wineries in the United States, Australia and New Zealand, says he has
been in discussion with possible partners to open the first shop, possibly in
Guangzhou, in the next few months. “Our shop in Hong Kong can serve as a window
for the rest of China,” he says.
As the company continues to map out its expansion plans, Mr Baduria says Hong
Kong will remain its base.
“Hong Kong remains the best hub in Asia for the wine market because of its
highly efficient systems and zero wine duty. We will keep Hong Kong as our
regional headquarters as we grow, enabling us to manage our business operations
in other cities in Asia from our hub in Hong Kong.”
Vine and Wine China
The Organization Internationale de la Vigne et du Vin International, or
Organization of Vine and Wine (OIV), is an intergovernmental association of 43
member states with an interest in all aspects of wine production. Vine-growing,
grapes and any wine and spirits of viticultural origin are of interest to what
is often referred to as the “United Nations of Wine.”
 Yves Bénard was elected as OIV President
last July, the first French national in the post since Baron Le Roy in 1962. A
qualified agricultural engineer and oenologist, Mr Bénard is a graduate of the
SupAgro International Centre for Advanced Studies in Agricultural Science and an
eminent personality of the wine and spirits sector.
Attending the HKTDC Hong Kong International Wine and Spirits Fair last November,
Mr Bénard talked about his impressions of the region’s rapidly growing wine
culture and his aspirations for the mainland to become a full-fledged member of
the organization.
Competition
and Education Key for Hong Kong Wine Hub
http://www.youtube.com/watch?v=MZJdhCEz-hk
What was your connection with Hong
Kong and the Chinese mainland before your election to the OIV?
I am also General Manager of the
Champagne and Wine Division at LVMH Moët Hennessy Louis Vuitton. Our regional
office for Asia is here in Hong Kong, where we cover markets across the region
and as far away as Australia. So we anticipate Hong Kong will be the key place
to be.
Tell us more about the role of the OIV.
OIV is an official international
organisation in terms of scientific and technical issues, gathering 43 countries
from around the world. It is a governmental organization that meets three times
a year. Experts from different countries work together on issues concerning
viniculture, and also on topics about wine consumption and education.
The mainland has been involved only as
an “observer” through Yantai, in Shandong Province, for the past 20 years. Why
are you now interested in the mainland becoming a full-fledged member?
China, of course, for us is a very
important country as a producer of wine and low-cost grapes – the OIV is also in
charge of work regarding cheaper grapes. So it is important not just as a
wine-consuming country, but also as a grape-growing country. So [that’s why] I
think China must be part of the OIV in the future. I also know that the Chinese
government is interested in hosting in maybe in two or three years’ time the
Annual Congress of the OIV. I have already made some contact with the Chinese
government about this [late last year] in Beijing.”
What promise does the wine industry on
the mainland, and throughout Asia, hold for France and other wine producers
around the world?
I’m French, but I’m here as the
president of all the countries belonging to the OIV. And I consider that China
will become a major wine market, again, not only for imported wines from around
the world, but also for producing wine – and, I would say, quality wine. The key
question today in China is [how] to help the Chinese people interested in the
wine industry produce quality wine. So China is definitely the key market for
the future.
In terms of developing the China
market and its industry, how important is education and such events as the Hong
Kong International Wine and Spirits Fair.
I think education is an absolutely
fundamental issue, and I think that an exhibition like this, with all the wine
tasting organized, is very important. First of all, educate the people who are
working in the wine industry – I mean the distributors, wholesalers, sommeliers.
All these people will then be able to educate the consumers. So it’s a long
process, but it is a key process in order to avoid situations where you see very
good wine mixed with soft drinks or something like that. I also think it’s very
important that the region learns how best to match Chinese food very well with
wine.
How can Hong Kong realize its plan to
become Asia’s wine hub?
First of all, Hong Kong has taken the
key decision to abolish wine tax, which means that in the coming year, I’m sure
Hong Kong will become the key place to import wine from all over the world. It
will then be the window, the place to resell in Asia. And I also know that in
Hong Kong, you have the right people to import, to manage the storage of wine in
good conditions, and to have these wine education programs. All of that means
that Hong Kong definitely is key for the future of wine in Asia.
March 2 2010
What's New at Napa By Rachel Platt
 The other night I caught a sneak
preview of the new menu and chef at Napa Wine Bar & Kitchen, Matthew Ona, ahead
of the official launch next month. I say sneak preview, but really anyone can
pop down there and see him for themselves. (Sometimes I just like to sound all
big and important.)
Ona says his plans for the new menu are largely based around finding the best
local ingredients, often a thankless task in China. “The aim eventually is to go
from farm to plate, sourcing ingredients from suppliers who practice sustainable
farming techniques,” he says. It may all sound a bit heard-it-all-before
marketing speak, but I tasted the bibb lettuce he’s sourced for Napa’s salads
and it is truly something special. He’s only been here a couple of months so
I’ll give him some space to live up to his promise.
There’s also good news for those of you who enjoy wine, but don’t know your note
from your nose: Ona’s grand plan is to make Napa’s 700-strong wine cellar more
accessible to everybody. Starting April, diners can enjoy a five-course,
wine-paired taster menu, all for a very affordable price, apparently. “Too often
people feel intimidated by a wine list, they don’t know what to choose-I want to
remove the elitism and make it fun.” Hooray, no more agonized pondering over the
wine list only to end up ordering the second-cheapest.
Oh, and make sure you try the seared salmon with English peas and three-citrus
coulis: it's yummy.
January 21 2010
John H. Isacs's wine drinking New Year resolutions for 2010
IN the West we are fond of making, then often breaking, resolutions for the New
Year. The goal of resolutions is to improve your life. With this in mind, I'd
like to share my three wine resolutions for 2010 that hopefully will not only
improve my wine life but also help readers.
I also encourage you to make your own wine resolutions for 2010. Just remember
that resolutions are fun to make and even more fun to keep.
 Drink more Kiwi wines
Something special is happening in New Zealand, in particular in the region of
Marlborough that's located in the north of South Island.
It is unprecedented in the history of wine for a region to go from absolute
obscurity to making world-class wines in three or four decades as Marlborough
has done.
 The brilliant sauvignon blanc whites
that first put this region on the world's wine map and the ever improving pinot
noirs are wines that should be on everyone's priority list for 2010.
Particularly recommended are two wines from Terrance Heights Estate, the 2008
sauvignon blanc that's chock full of tropical fruit and the classically fruity
2006 pinot noir that features intriguing hints of French oak.
Also not to be missed are two wines from John Forrest that mirror his outgoing
and entertaining personality, his exuberantly fruity yet wonderfully balanced
2008 sauvignon blanc and excellent 2007 pinot noir featuring plenty of elegant
dark fruit flavors.
The bold flavors of New Zealand wines pair very nicely with many flavorful Asian
dishes.
 Get to know South Africa
Since quite a young age, I have traveled around the world tasting wines. Today,
a big part of my work is to visit Europe and other wine-growing regions to
better understand their products and also promote understanding of the China
market.
Behind this good fortune is the sad truth that I've never been to South Africa
and know far too little about their wines.
Wine-loving friends from around the world have implored me to taste more of the
distinctive and high-quality wines coming from South Africa.
I'm still preparing my tasting list for 2010, but definitely included are the
Fleur due Cap pinotage and cabernet sauvignon reds as well as merlot and merlot
blend Rubicon wines from Meerlust.
 Make-up with Bordeaux
As mentioned last week, I'm often critical of the quality of inexpensive
Bordeaux wines that are unloaded on Asian markets. However, Bordeaux was the
first love of my wine life. Over the past two decades, exponential price
increases and the growing number of excellent alternatives from other regions
caused something of a break-up.
But I think 2010 is a fine time to try and make-up, particularly with some of my
favorite Bordeaux sub-appellations like Saint Estephe and Saint Emilion.
Of course, the great chateaux of both regions are always worth tasting if you
can afford them. But they also offer superb quality wines at much lower prices.
From Saint Estephe try the hearty wines of Chateau Meyney and Chateau Les Ormes
de Pez that have plenty of spicy dark fruit flavors and abundant tannins which
make them perfect for red meat dishes.
From Saint Emilion, don't miss one of Bordeaux's fastest rising stars, the
elegant and complex Chateau Haut-Brisson.
SOURCE: Shanghai Daily
Jan 19, 2010
 Follow your nose -
Asian buyers' competitive spirit has turned Hong Kong into a major wine hub much
faster than traders expected By Ben Sin
 A former amateur racing driver, Carson
Chan Kai-shun enjoys cars. So when an opening came up at Bonhams' local
subsidiary 10 years ago, he seized the chance - the auction house was then
better known for its sales of vintage cars. But now, as managing director of
Bonhams in Hong Kong, Chan finds himself at the forefront of a regional wine
boom that has made Barolos and Chateau Rothschilds the focus of his attention
rather than Aston Martins and Rolls-Royces.
Traders expected a boost from the government's scrapping of wine tax in 2008,
and their hopes have since been fulfilled in impressive style with Hong Kong
quickly challenging London's place as the world's second biggest auction market
for fine wines after New York.
"I knew the auction scene was going to be big in Hong Kong as soon as the tax
was dropped," says Chan.
Still, it took nifty footwork to catch the wave. "We had a hunch months in
advance that the government was going to lower the wine tax because officials
had been talking to people in the wine industry," Chan says.
Once the tax abolition was announced, he and his team got together and made
swift plans. Within two months Bonhams held a wine auction - its first in Hong
Kong for over a decade - recording sales of more than HK$11 million.
Other auction houses soon followed, with Sotheby's announcing that Hong Kong has
become its most important centre for fine wines after notching up more than
HK$111 million from its three sales last year. Its auctions in New York took in
US$12.7 million while London booked £9.2 million (HK$116 million) from 10
auctions.
 "Last year will be remembered as the
year Asian collectors overtook the US in the purchase of fine wine at auctions,"
says Serena Sutcliffe, head of Sotheby's international wine department. Local
and mainland buyers accounted for 40 per cent of Sotheby's total wine sales.
John Kapon, president of international wine merchants Acker Merrall & Condit,
reinforces the view. "Asian buyers in general have been what's driving the
sales," he says. "Not just in Hong Kong [but also in New York]."
Still, Chan was surprised by how swiftly Hong Kong's auction market had grown
following the end of wine tax, attributing it partly to last year's financial
meltdown hitting the US harder than Asia as well as a growing thirst among
mainland buyers.
The surge was also in reaction to a lack of auctions earlier, says Jamie
Ritchie, senior vice president of Sotheby's wine department, who expects the
market to stabilize after the initial fervor.
Kapon, however, sees the recent boom as a natural phase in Asia's growing
interest in wine.
Bidding in Hong Kong tends to be more lively than in New York or London, Kapon
says, and there's a "friendly, competitive nature here that can't be found
elsewhere".
Recalling an Acker Merrall & Condit auction where he wielded the gavel last
year, he says the event at a local hotel had to be moved from one hall to
another because bidding went on far longer than expected.
As in many businesses, much of the impetus for growth is coming from the
mainland, particularly from wealthy Chinese for whom premium wines have become a
status symbol as well as pleasurable pursuit.
Chan attributes the strong Chinese interest in wine auctions partly to cultural
mores. "Chinese people in general really care about face," he says. "If I invite
a friend to dinner and I open up an expensive bottle of wine, he'll feel the
need to top it by opening up a more expensive bottle of wine the next time he
invites me to dinner."
Jack Hui Wai-po, who founded the Hong Kong Fine Wine Auction website with a few
friends in November as a way for enthusiasts to make small trades, echoes the
view.
"Chinese people, if they can afford it, really like to indulge and spend on the
biggest brand names and expensive items, and wine is no exception," says Hui,
who estimates up to 60 per cent of wine traded on his website ends up on the
mainland.
The end of wine tax acted like rocket fuel.
"Many mainlanders buy and store their wine in Hong Kong until they need it due
to the high tax in China," says Kapon. "Hong Kong has become a portal for
mainland buyers who want to avoid duties."
Purchases by mainland wine buffs have opened new opportunities for wine traders
to provide storage services.
"We offer storage here at a small percentage fee," says Hui. "They place bids
online and, after the purchase, they have an option to store the winse with us
and pick them up in small batches each time they come to Hong Kong."
But to keep the wine scene growing, traders and enthusiasts agree novice buyers
have to be better educated. "You can't keep buying something you don't
understand," says wine lover Danny Wong King-wang.
A frequent participant at wine sales, Wong views the auction fever as a fad but
he hopes to turn it into sustained interest by helping novices learn more about
wines and collecting.
Which is why he opened Vintelligence, a club that provides a venue for members
to share experiences and knowledge about wine, as well as to trade.
"Some people look at wine as an investment and I hate that," Wong says. "It
should be something to be enjoyed."
Chan also reckons more knowledge is needed to keep up interest among the
swelling band of local wine buffs.
"The growth rates in Hong Kong don't just indicate rich buyers willing to spend,
but wine drinkers becoming more sophisticated. To sustain this, we've started
wine education courses to help spread the culture," he says.
To attract mainland buyers unable to attend its Hong Kong auction, Sotheby's
last year introduced live online bidding, where participants make offers via the
internet with video and audio feeds.
"Live bidding was most popular at the Hong Kong auctions, with most of the
bidding coming from mainland buyers," says Ritchie, who plans to further develop
online business.
With Asia becoming the prime hub of his international business, New York-based
Kapon also expects to spend more time in Hong Kong this year.
Acker Merrall & Condit sold more than HK$165 million worth of wine here last
year - the most among the auction houses - and Kapon expects an 80 per cent
increase in business this year.
Five auctions are being held, including a major sale next week that will feature
a "super-lot" group of premium Bordeaux valued at about HK$680,000.
"In all my years in the business, the value of wine has only gone up," Kapon
says. "So it's here to stay regardless of how the economy is."
September
20 2009
Spanish vineyards target China's wine
drinkers
The Spanish Wine Market Observatory (OEMV) shows wines exported to Hong Kong
soared 80% in value to Euros300 million in the year to April 2009, rising 31% in
sales.
 According to Robert Tinlot, Honorary
General Manager of Spain's International Organization of Vine and Wine (OIV),
China is set to eventually become the world's premier consumer market for wines
and is already the fastest growing globally. He sees Hong Kong as the strategic
gateway to unlocking that vast potential market, with the territory an
established centre for wines in its own right.
That was mainly down to Hong Kong's abolition of its 40% duty on wine in
February 2008, allowing global players to take advantage of the territory's
logistics, finance and infrastructure capabilities to set up wine trades.
 However, Spanish vineyards and
distributors currently rank eighth as wine traders into Hong Kong, well behind
market leaders France and the UK. The Director General of OEMV, Rafael del Rey,
sees that position changing with Spanish companies more often holding
presentations, tastings and symposia to increase their commercial networks.
Spanish distributors are prioritising
their target markets as Hong Kong, Singapore and Chinese mainland coastal cities
in Asia, as these have more progressive lifestyles and consumers possess greater
discretionary purchasing power.
Wines from Spain could penetrate both the Chinese mainland quality and mass
markets. Spanish distributors also expect to build sales for re-distribution
from China to the rest of the region under different pricing approaches.
Spanish wines underperforming - The UK's Wine Intelligence research company
estimates that Spanish wines are consumed by 42 million drinkers in the US, the
UK, Germany, Belgium, Switzerland and the Netherlands - but that means that 100
million consumers have not tasted Spanish wines in these developed markets,
leaving a huge potential for growth.
 At the same time, many consumers
globally are not aware of the diversity of Spanish wines nor have a studied view
as to their merits, since Spanish brands are less well developed.
 That doesn't imply individual Spanish
wines have not entered the lexicon for excellent quality. When wine lovers
around the world talk about Spanish wine, the name Rioja invariably appears.
This protected denomination of origin (PDO) has received international
recognition.
However, there's a wide range of wines
throughout the entire portfolio of Spanish vineyards that offer individual
qualities, such as Cava of Penedes and wines from Catalonia, the Ribeiro and
Albariños in Galicia.
Denominations of origin include brands such as Ribera del Duero, Toro or Rueda
in Castile; Valdepeñas in La Mancha; Jumilla in Murcia; Carinena in Aragon;
Utiel-Requena in the Valencian Community and the fine Andalucian wines such as
Montilla-Moriles and Jerez de la Frontera.
 Luxury Emita wine at Euros1,245 per bottle.
Spanish sparkling wines, Cava, have particularly shown strong sales growth
despite being affected by the sales of French champagne at very high prices.
Sparkling Spanish wine exports grew 22% in 2007 and 143 million litres was
shipped, worth Euros435 million. Some experts consider this sector to appeal
particularly to Chinese mainland drinkers, due to the wine's celebratory aspect.
The US is considered to be where there are good shorter term opportunities for
Spanish wine's consumption growth, with the US an ever expanding market of 60
million consumers. Over 2% sales growth was reported in 2008, very similar to
2007, and mainly due to young people becoming interested in Spanish wines.
Italy, Portugal and France are seen as Spain's current bulk markets, as well as
China, South Korea and Japan in Asia. In Asia there was a noticeable increase in
sales of sparkling and table wines. Other European markets such as Belgium,
Germany and Ireland have evolved positively too.
One of the foremost Spanish wine distributors in Asia is Torres, founded in 1870
with headquarters in Vilafranca del Penedès (near Barcelona) with vineyards also
in other zones such as La Rioja, Toro, Jumilla or Ribera del Duero, as well as
in Chile and California, the US.
Other wines sold under the Torres brand are Viña Sol, Sangre de Toro, De Casta,
Coronas, Atrium and Viña Esmeralda.
Among brandies, the brands Torres 5,
Torres 10 and Torres 20 are well known and are considered among the best brands
worldwide. Torres wines are exported to over 140 countries.
Another coming export to Asia is Spanish sherry. Says Francisco Valencia,
President of Marco de Jerez wine cellars: "sherry is particularly relevant to
Chinese cuisine. It is very often preferred by Chinese chefs, since dry wines
are too acidic."
June 5 2009
Traders Toast Wine Pacts
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Australia's
Minister for Agriculture Tony Burke (centre, left) and Financial
Secretary John Tsang (centre, right) toast the success of the Hong
Kong-Australia trade agreement on wine |
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More Australian, Italian and Hungarian
wine may be destined for Asian tables following agreements brokered in Hong
Kong to provide easier access to Chinese mainland markets.
Separate Memorandums of Understanding
(MOUs) on wine-related businesses have been signed with Australia, Italy and
Hungary recently, as part of a bilateral cooperation on wine and food. They
are the latest initiatives in the promotion of wine-related investment and
tourism following the Hong Kong Government's scrapping of duty on wine
imports in February 2008.
The signings are also seen as another
step in positioning Hong Kong as Asia's wine trading and distribution hub.
Australia's Minister for Agriculture
Tony Burke, in Hong Kong to sign the MOU in April, said the agreement would
give wine producers simplified, improved access to the Hong Kong and
mainland markets, addressing such issues as certification and labeling. "In
a country the size of China, a single window to government will make it
easier for the Australian Wine and Brandy Corporation to help exporters ship
wine to this important market," he said.
Hong Kong Secretary for Commerce and
Economic Development Rita Lau said Hong Kong has all the ingredients
necessary to play an important part in tapping the mainland's growing
appetite for quality wine. "We have the infrastructure, the expertise and
the desire and determination to be Asia's wine trading and distribution
hub."
Business to Benefit
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South
Australia's premier wine region, the Barossa Valley, is set for more
exposure in Greater China |
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A rare bottle
of vintage Krug set a world record for Champagne at a Hong Kong
auction in March |
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Australian wine traders welcomed the
latest initiative. Malaysian George Tham moved to Hong Kong earlier this
year to co-found Parade Artwine Ltd, a trading company specialising in South
Australian wines.
"This is very good news for our
business – it will definitely help us," said Mr Tham. Parade Artwine was
established to introduce new Australian wines, primarily from the Barossa
Valley, to emerging markets in the region. Mr Tham and his South Australian
business partner chose Hong Kong as their launching pad because of its
geographical location. "There are plenty of opportunities for the wine
business in Asia, and now getting wine into Chinese markets will be so much
easier," he said.
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“Sizzling”
Market |
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Wine worth
US$4.82 million was sold at Acker Merrall & Condit's fine and rare wine
auction in Hong Kong last week |
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Another successful
auction in Hong Kong last week by American fine wine trader
Acker Merrall & Condit showed the Hong Kong market remains
strong. Vintage wine worth US$4.82 million changed hands at the latest
Acker Merrall auction, its fourth in Hong Kong since its inaugural sale
in May 2008. "The
result is a testament to the strength of the wine market in Asia and
underlines Hong Kong's leading role as a regional hub of fine and rare
wines," said President and Auction Director John Kapon. "Such an
enthusiastic response from buyers indicates a renewed confidence in the
wine market and proves there is a continuing strong demand for fine
wines of superb quality and rarity. We are fully committed to further
developing our business in Hong Kong."
Among the items sold was
a lot of six bottles of rare 1985 Henri Jayer Richebourg, which went to
a Hong Kong collector for US$68,432, well above the pre-sale estimate.
The latest result follows
the company's "sizzling" March auction, during which 96 per cent of the
lots were sold, and a new world record set for a bottle of Champagne –
US$21,091 for a bottle of rare Krug Collection, vintage 1928. |
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Peter Chu, Cellar Director,
Cellarmaster Wines (HK) Ltd, said the MOU would give his business increased
exposure and further elevate Hong Kong as a platform for Australian wine. He
welcomed the opportunity to promote the various wine regions and different
characteristics of Australian wines to Asian consumers, who, with their
maturing palates, no longer think of wine in a generic way.
"My personal mission is to promote
mature Australian wines, not just the fresh, new varieties, as I believe
there would be a huge market for it," Mr Chu said.
Peter Riha, Managing Director of Solar
Max Ltd, which imports wine from South Australia, agreed that this latest
wine initiative is "another move in the right direction."
Spotlight on Italy
The agreement with Italy, signed last
month, will forge closer cooperation in a wide range of areas, including the
promotion of wine trading, investment and wine-related tourism, as well as
wine education and appreciation, Ms Lau said.
"Specifically, the two sides will work
closely to engender a good showing of Italian wines and canapes, wine
accessories, as well as wine-making technology and equipment in the annual
international wine fair organised by the Hong Kong Trade Development Council
(HKTDC)."
Ms Lau said the Italians will
be encouraged to organise wine exhibitions in Hong Kong. Vinitaly, the
leading wine exhibition in Italy, is planning to stage its first wine
roadshow in Hong Kong as part of the HKTDC's annual wine fair in November.
Hungarian First
The Hong Kong-Hungary wine MOU, signed
27 May in Hong Kong, is the first trade agreement of any kind between the
two economies. Under the agreement, the two sides will strengthen
cooperation in the promotion of wine-related trading, investment, tourism
and education. They will also fight against counterfeit wine.
"Hungary produces quality wine. Wine
exports from Hungary to Hong Kong increased by as much as 78 per cent by
value in 2008," said Hong Kong Permanent Secretary for Commerce and Economic
Development Yvonne Choi, during the MOU signing.
"We expect this trend to continue as
Hungarian wines become more widely known and enjoyed here," added Ms Choi.
"And, more significantly, Hong Kong provides easy access to the mainland
market, where the potential for growth is enormous." |
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