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June 2018 WINES&VINES 31 VIEWPOINT few years ago, I was puzzled at how few trade people asked me about China. When I pushed, I was told sales to China were negligible, or even nonexistent, with a market like Canada more important. A look at the numbers bears this out. Wine Institute figures state that only 12.5% of pro- duction is exported and, in 2017, only 3.7% of that went to China. That translates to about 1 out of every 250 bottles, one-sixth of what is shipped to Canada. That doesn't mean China is irrelevant by any means. Consider the Hong Kong factor: in 2017, that duty-free zone ranked fifth by vol- ume for California exports (behind the EU, Canada, Japan and China) and, impressively, third by value (behind the EU and Canada) as a destination for U.S. wines. And it offers a gateway to China. "With a population of just about 7.3 million, we didn't empty all the 80 million bottles [we imported] ourselves — about half of the wine imported into Hong Kong was re-exported," said Paul Chan, Hong Kong's Financial Secretary, at last winter's Hong Kong International Wine & Spirits Fair. "It shouldn't surprise anyone here that the massive market of the mainland of China is the key destination of our wine re-exports." But even with China and Hong Kong com- bined, the total volumes and values are still relatively modest. The lure of a potential bil- lion customers might glow but there is also the reality of where you are going to make your money next year. Finally, there is market readiness. For all the talk of a new wave of Chinese consumers who buy wine based on taste and who are targeting the mid-range niche, the market still sees po- larization between those who seek trophy wines, still typically from France or the Australian brand Penfolds, and those who circle the bar- gain bin for the cheapest wine possible. U.S. wine consumers, on the other hand, seem to be more well-informed. I've written for Wines & Vines before about how faking U.S. wines is less lucrative because consumers of such labels are more knowledgeable. And those already committed to paying more than the minimum for wine provide some insulation from price rises due to tariffs. In other words, a lot of factors — pricing, a (lack of) a sense of urgency by producers, and a still emerging taste-based market — sug- gest U.S. wines might simply be a longer-term play. You can't always force a result. The long game Does this mean we lack ways to encourage more Chinese to drink U.S. wines now? Ap- proaching the market on a national, rather than a state or regional level, might help. Both for those who don't know that the U.S., let alone California, makes wine, and for those who have studied, worked or visited beyond in wine-producing states such as Oregon, Washington, New York and Virginia. To this end, American Wine Merchants recently teamed with the U.S. government to make online sales easier for U.S. wines as a whole. Reaching out to consumers with U.S. expe- rience would also help. Last year, the Ameri- can-owned wine club Sig Wine organized a Beijing tasting for 130 U.S. alumni group mem- bers. These are attendees who have extensive stateside experience, are interested in wine and are flush with disposable income. The tasting was not for U.S. wines but easily could have been. And, in a similar vein, further pushing wines in venues with an American theme would reach people already predisposed to U.S. products. Going to an "American" restaurant that serves De Bortoli by the glass does not inspire. Beijing-based Canadian Jim Boyce has covered China's wine scene since 2005. He founded the website Grape Wall of China in 2007, has written about the wine market for a wide range of publications, and regularly organizes wine events for consumers and trade. SUPPORT RESEARCH & WINE INDUSTRY NEEDS THROUGH THE A M E R I C A N V I N EYA R D FOUN D AT I O N a dva nc i ng m e t h o d s t o e n h a nc e w i n e f l avo r The ability to monitor grape aroma compounds and their precursors will allow for a better understanding of how vineyard and winemaking processes influence the volatile aroma composition of wine. Dr. Ebeler's research uses innovative analytical chemistry approaches to analyze and understand glycosidic precursors in grapes and to profile free and glycosidically bound aroma volatiles in grapes and wine. For more information, visit AVF.org or contact Dr. Ebeler at seebeler@ucdavis.edu. For a wealth of useful viticulture and enology research and information, visit AVF.org, ngr.ucdavis.edu, asev.org, iv.ucdavis.edu or ngwi.org Finding Solutions Through Research Finding Solutions Through Research AMERICAN VINEYARD FOUNDATION • P.O. Box 5779, Napa, CA, 94581 • tel (707) 252-6911 Visit our Web site at www.avf.org for information on funding and current research projects AMERICAN VINEYARD FOUNDATION • P.O. Box 5779, Napa, CA, 94581 • tel (707) 252-6911 Visit our Web site at www.avf.org for information on funding and current research projects