The Rising Dragon
China set to drive global growth of wine industry
The remarkable growth of wine consumption in China is set to increase by over a third to nearly $23bn over the next five years, according to new data commissioned by Vinexpo from IWSR.
With consumption of still and sparkling wine forecast to reach 192 million 9-litre cases by 2021, China will be propelled into the second most valuable world wine market behind the USA. For its consumption in volume, China is currently ranked fifth for still wine after the USA, France, Germany and Italy. By 2021 China is expected to overtake Italy as the fourth largest market for consumption of still wine in volume.
“As China grows richer, displays of knowledge and education are replacing wealth as an indicator of status; wine is expected to be one of the main beneficiaries”, comments Guillaume Deglise, CEO of Vinexpo.
LOCAL SPIRITS DOMINATE
Spirits such as Baiju make China one of the top five spirits consumers. However, measured as a share of pure alcohol, consumption of Baiju is so high that a significant increase is unlikely.
Japan forecast as one of two major drivers of sparkling wine consumption in Asia in the next five years
With Australia, Japan pushed sales of all categories of sparkling wine in the Asia-Pacific region to a total value of $2.79 bn in 2016. The two countries accounted for over 9 million 9-litre cases in 2016 out of total consumption of more than 13.3 million cases. This drive is forecast to continue over the period to 2021 when total value of sparkling wine in the region is expected to reach $3.73 billion for total consumption of 15.8 million cases.
Approximately half of the growth in Japan will come from imports of Chilean sparkling wine, buoyed by the success and reputation for quality and value for money of Chilean still wines.
Among other sparkling wine categories Cava saw the highest gains in 2016 due to strong growth in Japan. This growth is expected to continue over the next five years at a CAGR of 8%.
Guillaume Deglise, CEO of Vinexpo, said “Sparkling wine pairs well with Japanese food and tiny per capita consumption means it has plenty of room for growth.”
Korea: Wine drinking set to bounce back in next five years
Growing interest in wine by younger consumers in South Korea is set to push consumption of still and sparkling wines in South Korea over the next five years, according to Vinexpo.
The growth, forecast at 1.2%, will add more than 200,000 9-litre cases of still wine to consumption by 2021. Sparkling wine will show even faster growth of 4.3% over the period. This growth overcomes an overall volume decline of 2.7% in both categories during 2016. Consumption is expected to rebound from 3.8 million 9-litre cases to 4.1 million by 2021.
The total value of still and sparkling wine in the Asia-Pacific region reached $29.74 billion in 2016 and is forecast to exceed $40 billion by 2021.