France has a 44% market share of the Chinese market

Friday May 26 2017 by Vitisphere

China, including Hong Kong, has been France’s third-largest market since 2014. Revenue from French exports has surged in the region, increasing by 27% in 2015 and 9.9% in 2016, according to Business France. Overall export value was in excess of one billion euros in 2016 for wines and spirits, divided between 612 million euros for wines and 393 million for spirits. The trend is ongoing, as evidenced by initial figures out for 2017. Over the first two months of the year, the increase in the value of French exports to China and Hong Kong is 30.3%, giving France a 44% market share by value.

According to Business France, Chinese interest in French wines is supported by a fundamental change in lifestyle. Over the past ten years or so, China has become increasingly westernised. Consumption habits have changed with an increase in on-trade drinking in bars and restaurants and growth in online sales, mainly in the less westernised second tier cities. Ten years ago, most wine consumption was through gifting and the buyer was not the drinker. Now, Chinese customers buy for their own personal consumption. France now needs to consolidate its leadership position. The free-trade agreement between Chile and China has enabled Chilean wines to penetrate the market with a very competitive price tag. Australia has also redoubled its efforts to establish itself in the Chinese market and its efforts have paid off. China became the leading market for Australian wines in 2016. Total export revenue reached 2.17 billion Australian dollars (1.52 billion euros), with the moving annual total up 10% by September 2016. Also, Spain and Italy have been putting a lot of effort into establishing a position in the Chinese market. France must therefore be careful to keep up the momentum and rapidly adapt to a changing competitive landscape.

[ Source Vitisphere  / Picture credit: DR ]



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