Chinese wine: Pie in the Sky?
- Monday 22 March 2010
Considerable column inches and millions of internet posts testify to the interest in mainland China as an emerging market of thirsty wine consumers. But as producers around the world eye up China as a key export market, they might also be keeping an eye on its potential as a winemaking country in its own right.
With decanter.com breaking the news of the joint venture between Château Lafite and CITIC (China’s largest state-owned investment company) last spring, commentators are beginning to ask whether China will ever make significant quantities of drinkable, even fine wines.
In China’s Olympic year (2008), a group of Masters of Wine suggested that the country might, in the next 50 years, become a fine-wine producer. Others wondered if such crystal-ball gazing was tongue-in-cheek, given the generally lower quality of Chinese wine and the challenges facing viticulture there.
It is worth remembering that only the Chinese government owns land in China. All agricultural activity is organised via units, and Chinese farmers are not experienced viticulturists. Heavy irrigation and overuse of pesticides blight quality and many parts of the country suffer inauspicious weather conditions.
Shandong is a major centre for grape production, but summer rains wreak havoc with rot. Even with spraying, farmers are forced to pick early, yielding underripe grapes that produce unpleasant green aromas in finished wines. In such circumstances, the over-reliance on the later-maturing Cabernet Sauvignon grape is not ideal.
China is the sixth-largest producer of wine in the world, though in reality, it is difficult to know exactly how much wine it produces, since the figures are skewed by importation of large volumes of bulk wine that are blended with domestic products.
China has between 500–600 wineries and 40,000–50,000ha (hectares) of vines, but no accurate data for the quantities of grapes harvested exists. To meet demand from China’s new wine drinkers, bulk imports make up the surplus that the domestic vineyards cannot supply; that said, per-capita consumption remains relatively low.
Among the hundreds of smaller operations, three giants dominate the domestic industry: Changyu, Dynasty and Great Wall (the latter owned by COFCO, the government’s agricultural arm). Quality is not a pressing issue for the big three. They can appeal to Chinese consumers’ patriotic spirit, and their sales demonstrate the triumph of brand loyalty over product. While these producers’ wines occasionally appear overseas, quality remains low.
Behind the curve
Nor are the big three likely to pioneer a quality revolution any time soon. As Huiqin Ma, a vine geneticist at China Agricultural University and founder of one of China’s first student wine programmes, argues: ‘There are no incentives for the big players to improve quality. They net millions of RMB (renminbi, the Chinese currency) in sales and succeed on brand recognition alone.
When many Chinese consumers have little idea of how quality wines should taste, why should the larger companies innovate?’ Demei Li, winemaker at the Sino-French Experimental Vineyard near Beijing, adds: ‘If the largest companies produce considerable quantities of inexpensive, lower-quality wine, they have at least converted many consumers from baijiu [Chinese grain spirit].’
That said, there are some relatively sizeable Chinese-owned wineries, such as Beijing’s Dragon Seal or CITIC’s other main wine project, Niya, in Xinjiang, producing drinkable wine from international grapes. Niya claims to operate the largest vineyard in Asia and makes serviceable Chardonnay and Riesling, among others.
More exciting, however, are the smaller wineries, joint ventures or largely foreign-influenced operations that have sprung up in the last 15 years. Grace Vineyard of Shanxi, the brainchild of Hong Kong billionaire CK Chan and French co-founder Sylvain Janvier, was established in 1997 and is operated by Chan’s daughter Judy Leissner.
Grace is justifiably popular among knowledgeable Chinese consumers and has caught the attention of the likes of Jancis Robinson MW and Australian wine critic James Halliday. Entry-level Chardonnay and Cabernet Sauvignon are drinkable and well-priced at 75RMB (£6.80). If this is twice the price of the bottom-end wines of behemoths Changyu and Great Wall, the wines are at least twice as good.
Three other ranges – Grace’s Premium wines, Tasya’s Reserve, and the more premium Deep Blue and Chairman’s Reserve red blends – offer higher quality. Its Premium Chardonnay (130RMB, £11.80) typically shows decent citrus fruit and pleasant French oak, and is one of China’s best whites. The Chairman’s Reserve, which resembles Bordeaux in lighter vintages, weighs in at 405RMB (£36.80). If this seems pricey by international standards, at least Grace hasn’t fallen foul of the super-pricing strategy some Chinese wineries are currently brandishing.
Grace has also collaborated with Spanish wine dynasty Torres. This year, Grace and Torres released the first wine in their Symphony Series, a dry Muscat at a refreshing 10% alcohol that helps stave off the heat of the Chinese summer. The Torres winemaking team joined Australian Ken Murchison, Grace’s chief winemaker, last summer to face the challenges of viticulture Chinese style. Watch this space.
Wine for export
Dragon’s Hollow, in Ningxia, was formed by veteran wine distributor David Henderson in 2006. Henderson’s experience goes back to 1979, when he was one of the first foreigners involved in Chinese drinks packaging. He later established wine importer Montrose, a market leader in the 1990s.
The Dragon’s Hollow model is distinctive because Henderson produces Chinese wines specifically for export. Crisp, dry Riesling and abundantly drinkable, unoaked Chardonnay and Cabernet Sauvignon are sold extensively in the US at a competitive $12.99. Dragon’s Hollow’s US distributor, Broadbent Selections, has a strong presence in 17 US states and supplies to more than 30.
In 2008, a Merlot was added to the range and the entire vintage was overseen by Ant Mackenzie, former winemaker at Spy Valley in Marlborough, New Zealand. Encouragingly, the take-up has not only been from Chinese restaurants overseas but the likes of Las Vegas’s Caesar’s Palace and Dallas Rosewood Mansion on Turtle Creek.
The Lafite/CITIC joint venture has yet to produce its first wines, but the French have been producing wine in China for decades. Pernod Ricard, which was formerly involved in the Dragon Seal winery, now operates Helan Mountain, also in Ningxia. Philip Laffer, chief winemaker for Orlando Wyndham (owner of Jacob’s Creek), acts as consultant, and chief winemaker Lilian Carter produces wines from Chardonnay, Riesling, Merlot and Cabernet Sauvignon. Like Dragon’s Hollow, these are some of the cleanest wines in China – a country where winemaking faults are widespread – and are thoroughly drinkable.
One further joint venture worth watching is Treaty Port Vineyards in Shandong’s Penglai peninsula. Since 2004, Chris and Tiffany Ruffle have recreated a Scottish castle in the Penglai countryside and taken on winemaker Mark Davidson (of Hunter Valley producer Tamburlaine), following earlier technical help from Gérard Colin, formerly of Grace, now with Lafite/CITIC, also in Penglai. The Ruffles have planted Chardonnay, Merlot, Cabernet Sauvignon and, more excitingly, Grenache, Syrah and Marselan: a fungally resistant cross of Cabernet and Grenache Noir. 2009 saw their first commercial releases.
Some progress is also apparent among the Chinese-owned smaller wineries. Ningxia’s Helan Mountain area has attracted Emma Gao of Silver Heights. Bordeaux-trained Gao is certainly one of the country’s more talented winemakers. Following stints at Châteaux Calon-Ségur and Lafon-Rochet, Gao returned to China to produce distinctive Cabernet blends.
In China’s far south, in Yunnan, the Shangri-La Winery Company is also making leaps in quality. At high elevation on the mountainous plateau of Di Qing, predominantly Cabernet Sauvignon vines enjoy long sunshine hours and similar conditions to Argentina’s Mendoza. Shangri-La offers a range of high-altitude wines with potential, dubbed Alti-wine.
Generally speaking, however, the elements in China are not favourable. In the north-easterly region of Hebei and north-westerly Ningxia and Xinjiang, for example, vines have to be manually buried each winter to protect them from frost (although China has the human resources to cope: ‘I can have 3,000 people in 24 hours,’ says Grace’s Judy Leissner).
Some remain optimistic that pockets of higher-quality will emerge; Demei Li believes that the Shacheng area of Hebei, just beyond The Great Wall, looks particularly promising. But sadly – and realistically – China is not likely to become a serious producer of fine wine any time soon.