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Creating Thirst for American Wine in China

Small U.S. wineries -- particularly those in Washington and Oregon -- are grabbing a piece of China's growing market.
In this Aug. 26, 2010 photo, Elizabeth Richardson pours wine for a tour group at the Chateau Ste. Michelle winery in Woodinville, Wash. Hong Kong and mainland China are developing a strong thirst for wine and Washington and Oregon are hoping for a taste of those markets.

The recession hurt U.S. wine exports last year, but not to Hong Kong, where American imports surged 138 percent to $40 million, according to U.S. trade data.

In recent years, China's newfound wealth has been feeding a demand for luxuries. As part of that new appetite, the Chinese – who once mixed wine with soda – are developing a taste for wine. The number of Chinese who drink imported wine – those willing to hand over $20 or more for a bottle – will grow to about 50 million within the next 15 years, estimates Wine Intelligence. (That's nearly the number in the U.S. who now drink imports.)

Not surprisingly, California wineries currently account for 90 percent of the U.S.'s total wine exports, but small wineries from Washington and Oregon are doing their best to grab a piece, particularly in emerging markets. The value of Washington's shipments to Hong Kong leaped fivefold last year, according to figures cited by the Associated Press.

Hong Kong – a major re-exporter to the Chinese mainland – is fourth-largest export market for U.S. wines, after Canada, the European Union and Japan. Since Hong Kong scrapped an 80 percent import tax in 2008, the country's wine imports leaped to a record $491 million – of which 8 percent was from the U.S. (The bulk of the wine was from France.)

Jonathan Ryweck, a one-man exporter for three Washington wineries, ships a few pallets at a time to the Far East.

"This is not a get-rich scheme, let me tell you," Ryweck told the AP of his Port Townsend, Washington-based company, Transnational Ventures. "It's growing very nicely but it's still real small volume and it's a tough sell."

But it's coming along.

"The Chinese love the taste profile of Washington wines," Ryweck said. "If you can get the product in their mouth, you can sell it." (Read more on American wine in China.)

In May, U.S. Commerce Secretary Gary Locke signed an agreement with the Hong Kong Commerce and Economic Development Bureau to help promote U.S. wine sales in China.

Earlier this year, a survey commissioned by wine fair Vinexpo revealed that red wine still is king in China, with 88 percent of annual total sales by volume. But as more Chinese women develop a taste for wine, white wine drinking is rising and is expected to grow by 41.7 percent by 2013.  

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IMAGE: AP Photo/Elaine Thompson
Last updated: Aug 9, 2010

COURTNEY RUBIN

Inc. contributing editor Courtney Rubin was for five years a London-based staff writer for People magazine. Rubin, a former senior writer for Washingtonian magazine, has written for the New York Times magazine, Time, Marie Claire, and other publications. She is the author of The Weight-Loss Diaries.




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