(Dedicated to two fine oenophiles, Anadyr and JerryCoin)
With a few notable exceptions, a distinct mood of high seriousness has fallen upon Insiders discussions recently. Let me endeavour to inject a little levity (and perhaps interest) into proceedings.
The FT recently carried a piece on the following theme: "..even if prices are off their peaks, the wine market in Asia is booming."
Perhaps not the most eye-catching of headlines, I agree, but the piece itself carried some fascinating nuggets.
1. Berry Bros & Rudd (London wine merchants) hit its three months revenue target after just twelve days after opening in Hong Kong - where consumption has doubled since the city abolished duty on wine in 2008. Small wonder then that Hong Kong's growing army of wine merchants dream about what might happen if China - which levies a 48% tax on wine (by value, not volume) - were to follow suit. Given the mainland's sheer size, this is something wine drinkers everywhere might want to think about - and fear!
2. Data from California's Wine Institute suggests that Vatican topers currently lead international ratings at 73 bottles per head annually (even more last night!!); the British weigh in at 29 bottles and the Americans at 13 bottles, whereas the Japanese consume just fewer than 3 bottles a head.
3. Even if China started drinking at the Japanese rate the country would suck in another 3 billion bottles from the international market, or about one sixth of the world's current production excluding China's own production, from the 3% it drinks now. And what if mainland China took to wine like Hong Kong, at nine bottles a head. In that scenario, a third of the world's wine supply would be needed.Globally, wine output has not been rising much, if at all. A China surge has the power dramatically to change/damage the market.
4. Asian wine demand for the top Bordeaux names has already lifted by a third within four years, even after a one quarter fall from the 2011 peak. Any broader surge in demand, perhaps from China, must also lift mid- and low-end prices. Wine drinkers, the Vatican included, have been warned!!
(The inevitable consequence of these trends, already visible, is sales fraud. When I was in China last year, an article in one of the Shanghai daily's reported the unfortunate case of a wealthy local entrepreneur who thought he had purchased 500,000 bottles of premier cru claret, only to find - to his considerable chagrin - that, if true, this would have exceeded known production figures at a stroke)
Enjoy your tipple while you can, chaps!