Mainland wine importers optimistic despite clampdown on gift giving

In years gone by, the giant wine company Torres made special decorative gift boxes for Lunar New Year, confident there would be plenty of corporate buyers in China seeking expensive, elaborately packaged wine to give to contacts.

But not for the Year of the Horse. The demand for such special gift packaging has fallen so dramatically that it is no longer worth making special editions for significant festivals, such as the New Year or Mid-Autumn.

The government clampdown on gift giving has also affected another handsome, year-round revenue earner for the wine industry. Lavish banquets where red wine flowed and toasts were endless, have been pared back, particularly in Beijing. In the capital, people have to be seen to be implementing the government's decree to stop splashing the cash on wining and dining; events featuring high-end Bordeaux and top-drawer (rice liquor) are thin on the ground.

Customs figures show the volume of wine imports rose by 5 per cent last year. But they increased just 0.5 per cent by value and imports from France rose only 1 per cent by volume, and fell 10 per cent by value. But this doesn't mean it is total gloom and doom for the Chinese wine trade. China's wine-lovers enthusiastically took to grapes from Spain, Chile and Portugal, and continued to enjoy wines from Australia, Italy, the US, South Africa, Argentina and Germany.

The revenue gap has been, at least partially, filled by demand from young urban professionals who have developed a genuine love and appreciation of wine, rather than a desire to guzzle down exorbitantly priced Lafite Rothschild or Pétrus.

"These are younger people in their 20s and 30s, urban professionals who see wine as a hobby and a way of socialising. They drink to enjoy wine not to fall down," says Campbell Thompson, who runs The Wine Republic, a company little affected by the gift-giving clampdown. It notched up an increase in sales last year to 20 million yuan (HK$25.5 million).