Hong Kong growth in wine imports comes in part by deregulation of wine.
The abolition in 2008 of duty on wine imported into Hong Kong was the catalyst for the city to become Asia’s wine storage and trading hub. Since then, wine has been flowing in by the container load. Government figures show wine imports into Hong Kong rose by 40 per cent last year, reaching a value of US$1.2 billion, while Asia’s wine consumption is forecast to double to US$27 billion in the next five years. Hong Kong also accounted for more than half of the world’s wine-auction market in 2011.
But it has long been a USA strategy to dump wine in Hong Kong to keep USA prices high. That dumped wine, being dirt cheap, was treated poorly and went bad, and consumers associated USA with bad wine.
Mr De'eb rates Hong Kong’s cold supply chain as second to none. “I would say, if anything, the weak spots are abroad, not in Hong Kong,” he says. “London, for example, has not really evolved in the last 20 or 30 years, so their storage and transport practices haven’t advanced sufficiently to keep pace with the world’s best. In contrast, ours have leapfrogged past the UK and Europe to being the acknowledged leaders in the industry.”
USA wine is a highly subsidized business, and therefore the market players operate on a distorted field. If wineries pursued full mark in the Chinese market, they might have a chance.
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The abolition in 2008 of duty on wine imported into Hong Kong was the catalyst for the city to become Asia’s wine storage and trading hub. Since then, wine has been flowing in by the container load. Government figures show wine imports into Hong Kong rose by 40 per cent last year, reaching a value of US$1.2 billion, while Asia’s wine consumption is forecast to double to US$27 billion in the next five years. Hong Kong also accounted for more than half of the world’s wine-auction market in 2011.
But it has long been a USA strategy to dump wine in Hong Kong to keep USA prices high. That dumped wine, being dirt cheap, was treated poorly and went bad, and consumers associated USA with bad wine.
Mr De'eb rates Hong Kong’s cold supply chain as second to none. “I would say, if anything, the weak spots are abroad, not in Hong Kong,” he says. “London, for example, has not really evolved in the last 20 or 30 years, so their storage and transport practices haven’t advanced sufficiently to keep pace with the world’s best. In contrast, ours have leapfrogged past the UK and Europe to being the acknowledged leaders in the industry.”
USA wine is a highly subsidized business, and therefore the market players operate on a distorted field. If wineries pursued full mark in the Chinese market, they might have a chance.
Feel free to forward this by email to three of your friends.
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