In case your catalogue never arrived, you can rest assured that the first fine wine auction ever held on mainland Chinese soil went off without a hitch this weekend in Beijing. A case of 1989 Petrus and 1982 Chateau Lafite Rothschild sold for 320,000 yuan each ($US 47,000) and an imperiale of 1979 Chateau Latour sold for 32,000 yuan ($US 4,700). With it, the secondary wine market tiptoed its way into mainland China with little publicity beyond the usual Xinhua news release declaring prosperity and economic victory for all.
Significant wine tariffs, regulations, and import hurdles were sidestepped for a moment, reportedly bringing prices down by 30% for the wealthy mainland Chinese consumers that chose to grab a paddle at the Beijing Asia hotel Friday night. For China’s growing number of wine enthusiasts it could mean less buying trips to Hong Kong where recently rescinded 40% tariffs have made imported wine affordable to more wine drinkers. For importers attempting to develop the mainland market, it might signal the beginning of better conditions where challenges like allegations of under representing value in order to sidestep government tariffs will become history.
It was clear during my recent travels to Hong Kong that visiting mainland Chinese shopping groups with newly found wealth were bored with the knocked off luxury brand goods and eager to flaunt new wealth with bona fide Rolexes and legitimate Gucci. If new mainland wealth follows in Japans’ consumer footsteps, the infatuation with brand name goods would drive demand for first growths and other collectible wines at a breath taking pace, just as the Beijing Poly International Auction Co. recently demonstrated with their sale of 94% of offered Bordeaux consignments at 8.98 million yuan ($US 1.35M).
Only this time we are dealing with a behemoth market, and the impact on price and availability at the high end for venerable productions could be severe. Could the rapid acceptance of fine wine and a more accessible mainland fine wine market spell trouble for wine enthusiasts around the world regarding price and availabilty for limited production offerings? Ramping demand for specific brands is not matched as easily as in other sectors, where it is legitimately possible to crank up a factory on demand.
While there is little to be done to stop natural formation of the market, it is worth noting that China’s top end of the market seems like it could be driven as much by the value of the label as the pleasure inside the bottle. I don’t hear of too many families around Beijing making holiday jiaozi and enjoying a great bottle of wine together. Pedigree and Parker scores appear to be primary market drivers at the high end as supported by auction organizer staff member Ma Zhefei and other language in Xinhua’s release recapping the historic sale:
The wines were appraised at a score higher than 90 on the Robert Parker website, with a third of the wines even appraised at 100….Parker is a renowned American wine valuer, whose rating system is regarded as authoritative.
Could China be jumping on this bandwagon when the rest of the world just might be coming to their senses? In a recent column in the Wine Spectator, Matt Kramer’s column “Just Drink It” calls for a return to wine for all the reasons it has survived for centuries as the social beverage of choice . He says:
Enough with the fetishistic fussing. Let’s drink. And eat. And in the same way that we have been forced by circumstances to come to our senses on material matters about money and work, it’s probably also time for many of us to make wine a little less exceptional –in every sense– and a bit more about life itself.
Can somebody please translate that into Mandarin?