By George Tibbits
THE ASSOCIATED PRESS
SEATTLE (AP) — Hong Kong and mainland China are developing a strong thirst for wine, and Washington and Oregon are hoping for a taste of the growing markets.
So far, only a trickle of Northwest wines makes it to Asian countries outside of Japan. But experts say as affluence grows in China, so will the demand for the finer things in life.
The recession hurt U.S. wine sales to most of the world last year, but not to Hong Kong, where the value of American wine imports jumped 138 percent to $40 million.
Most of it came from California, which accounts for about 90 percent of the nation’s total wine exports. But the value of Washington’s shipments to Hong Kong grew more than five-fold.
Washington’s larger wineries have long cultivated customers in China and Hong Kong, and smaller exporters are seeking a foothold. Earlier this year, a delegation from Washington and Oregon signed a deal to promote wines in Hong Kong, their first trade agreement with that city.
“For our region, it’s about being present, and you win by being there,” said Al Portney, vice president of international sales for Ste. Michelle Wine Estates.
Portney said the Woodinville, Wash., winery pursues a methodical and long-term strategy showing that Northwest wines are high quality yet affordable.
Jonathan Ryweck, a one-man exporter of three Washington labels, ships a few pallets at a time.
“This is not a get-rich scheme, let me tell you,” Ryweck said of his Port Townsend company, Transnational Ventures Inc. “It’s growing very nicely but it’s still real small volume and it’s a tough sell.”
Still, the Chinese associate foreign wine with success, education, and status, he said.
“The Chinese love the taste profile of Washington wines,” Ryweck said. “If you can get the product in their mouth, you can sell it.”
Hong Kong’s wine imports have soared since it eliminated an 80 percent excise tax in 2008.
Hong Kong is now the fourth-largest export market for U.S. wines behind Canada, the European Union, and Japan. It’s also a major re-exporter to the Chinese mainland and other points.
Last year, Washington exported about $9.7 million in wine, but just $721,000 to Hong Kong and $414,000 to China, according to figures from Global Trade Information Services Inc. cited by the state Agriculture Department. However, exports to Hong Kong jumped 529 percent.
Most Oregon wineries are family affairs that sell domestically, said Katie Bray, Oregon Wine Board export manager. A small but eager group is interested in exports, and China has great potential, she said. But the board’s limited promotional money is focused on the major foreign markets: Japan, the United Kingdom, and Canada.
Watson’s Wine Cellar, Hong Kong’s largest specialty wine chain, does sell Oregon’s Erath and Argyle wines, however.
“All of a sudden, there’s an interest in Northwest wines,” said Argyle winemaker Rollin Soles.
Chinese on the mainland drink about 75 million cases of wine a year, said Richard Halstead, chief operating officer of the British consultancy Wine Intelligence Ltd. But 90 percent is domestically produced wine “that most wine consumers in other countries would struggle to recognize as the product they drink,” he said.
Foreign sellers need to guide new consumers on types of wines and how they taste, Halstead said.
“Chinese consumers are confused by wine,” he said. “This is hardly surprising. Most Western consumers are, too, and they don’t have to deal with a totally alien script when trying to decipher what’s on the label.”
Wine Intelligence estimates the number of Chinese who drink imported wine will grow to about 50 million in 15 years, nearly the number in the United States who now drink imports.
Portney and Ryweck see similarities with this country. The United States had a “hard liquor and beer culture” until World War II, when GIs brought a taste for wine home from Europe, Ryweck said.
Millions of Chinese work or study overseas and bring home what they learn, Ryweck said. “They’re changing Chinese society and part of that is wine culture.” ♦