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Chinese New Year 2018

Friday, February 09, 2018

Next Friday, February 16, is Chinese New Year, celebrated by a significant part of the world’s population. At that time we will be entering the Year of the Dog.

It is something that should not be ignored, as I believe that we are most definitely in the “Chinese Century” – in the same way that the last one was the “American Century” and the previous one (or two) were the “British Century”.  As the American influence and power continues to be Trumped and wane, China has stepped onto centre stage – mainly economically, but with a growing military might.

China’s economic might has grown awesomely this century. Back in 2003, the sale of three containers of wine bottled red wine to China, which was achieved by Thomson Fruitgrowers in the Riverland (where at that time I was the CEO) represented 0.5% of Australia’s red wine exports to China that year. People chuckled when I suggested that China was our vinous future. Since then our business, Wine Assist Pty Ltd, has shipped over 600 containers of wine to China on behalf of our clients.

Today, the figures are staggering and still rising thanks to the current federal Government finalising the FTA (Free Trade Agreement) with China which was signed shortly after they took office (after 6 years of stuffing around by the previous government).

Recently, I saw the statistics for wine sales to China for 2017 up to 31-Oct-2017. Here in a nut shell are the salient points:

In that 10 month period, China bought just under 84.5 million litres of wine from us, valued at just under USD537 million (approx. AUD750 million) and given that November is the biggest month of the year for shipments to China (in preparation for Chinese New Year), we could possibly be looking of wine sales to China of almost one billion Aussie dollars for the year!!! That is truly awesome!!

Not only that, but also figures show that the average price per litre is around AUD8.50 per litre – the highest we achieved across the globe. We currently account for 26.5% of all wine imported into China (France 41.4%). Our average dollars per litre sell price is 31.0% higher than the French (despite the ubber expensive prices of Bordeaux and Burgundy) and we are currently growing our sales values at 21.0% (year on year) whilst the French are growing by 4.2%.

I am not saying that we are going to overtake the French as No.1 anytime soon, but if we do the right things, and keep promoting our wines in China, our annual sales of wine to China can and will reach AUD1.5 billion in the near future. If you also consider the increase in wine consumption across the rest of Asia (barring India – thanks to their government) the future for the Australian wine industry is looking pretty bloody rosy and a lot less likely to be severely impacted by events in Europe (Brexit) or in the USA (Trump).

So whilst, as always, care should be taken as to whom one deals with, make sure that you have a China (and Asia) strategy and that you get into these markets while we are “riding the wave” because Asia is our vinous future – AND IT HAS ARRIVED!! Cheers and have a great week!

THIS WEEKS WINE REVIEW:

This week we look at a wine with grapes that come from old Barossa vines that should really be classified as “pensioners”. Well, one block consists of 82-year-old bush vines (Stonewell), whilst the “youngster” block (Eden Valley), is only 57-years-old and therefore has nine more years to go before being officially deemed as a pensioner under the Federal Government’s regulations.

I am talking about the sensational ST. JOHN’S ROAD 2016 ‘THE EVANGELIST’ OLD VINE BAROSSA SHIRAZ.

 

This wine is made in open fermenters with respect for the better parts of the old ways of making wine and with the aim of achieving restrained power and depth.

After fermentation, the wine is put into French oak hogsheads and barriques of which 50% are new. After an eighteen month sojourn in the oak, it is bottled.

‘THE EVANGELIST’ SHIRAZ has a mid-depth, bright purple/red colour, lovely, complex (for such a young wine), aromas of plums and vanillin oak.

The palate is smooth, rich and multi-layered with great nuances and a delightful, lingering finish. It is a very elegant and yet powerful wine.

To read more about this and the other great wines on offer by ST. JOHN’S ROAD visit the website at: www.stjohnsroad.com  Well worth checking out!!!