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Negative Growth Came Forth in China Wine Industry

Author：Sybil XU

Economic cold wave has swept from China white spirit to wine industry. According to the data of DRCNET, China wine output appeared negative growth in November last year. The relevant concerned that global consumption depression might make foreign wine industry pass the press of depreciation to domestic market.

With 10-mouth growing continuance stopping, negative growth came forth last November for the first time in China wine industry. According to DRCNET, the total wine output was 63.37 thousand ton, reducing by 0.29%. But in the statistical data of June, the output was 89.03 thousand ton, increasing up to 115.52%.

“The wine output has plummeted for 5 months since last June.” Teng Wenfei, the analyst of Food& Beverage Industry in Shanghai Security, warned in current report, “we think that the economic impact on wine industry this year will be more tremendous. It had better elude risk in the short run.”

The wine sales generally declined 15% to 20% by volume last year comparing with 2007.” Some agent of Great Wall Wine told to the journalist, “the terminal wine price is relatively steady at present due to the strict control by wineries, but definitely it will decline after Spring Festival.”

He added: “without exception, sales volume will suffer from the economic crisis, no mater what brand it is.” The journalist made a phone call to relevant principal in Southern China Sales Center of Changyu Wine, but he refused to declare his view on the grounds of inconvenience.

Xia Zhongbang, Regional Manager of Constellation Company China Section told to journalist that the depreciation of imported wines might also impinge domestic wine sales. “There is a large space for the depreciation of foreign wine by the 20% decline of cost, due to the depression of AUD and USD.”

“The downturn mainly comes from Hebei, Henan and Tianjin with the brands Great Wall, Dynasty and Weilong. Last November, the average price of small-packed imported wines dropped 24%, remarkably lower than the average level of the former 11 months. We worried global consumption depression might make the depreciation press passed to the domestic market from foreign wine industry.” Guosen Securities Huangmao said.

Keywords: Wine    China market

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