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Research Report on Chinese Wine Industry, 2010-2011

Chinese wine industry has entered the high-speed growth stage in recent years. Though the international financial crisis broke out in 2008, it did not place severe influence on Chinese wine industry. In 2008, Chinese wine production totaled 698,300 kiloliters, 5% increase over 2007. In 2009, Chinese wine production amounted to 960,000 kiloliters, rising by 37.48% YOY.

Wine belongs to the fast moving consumer goods. The competition on Chinese wine market concentrates on the market capacity and channels instead of product function, attribute and technology. Channels have become the key successful factor for competition. In China, the consumption channels for wine mainly include two categories – restaurants & hotels; retail channels such as shops and supermarkets. According to the statistics of the wine industry, the restaurants and hotels account for over 50% shares in Chinese wine market while retail channels occupy less than 50%. Among those retail channels, supermarkets and general merchandise stores take up over 50% while the rest are shared by convenience stores, exclusive stores and independent food stores, etc.

The concentration in Chinese wine industry is much higher than that in the beer and liquor industries. The sales volume of ChangYu, Great Wall and Dynasty has occupied over 40% on Chinese wine market.

China enjoys the highest wine consumption growth rate in the world. Since the 21st century, the wine consumption in those traditional wine consumption countries does not see obvious increase while Chinese wine market achieves prominent growth in the wine sales volume. With the improvement of the living standard, more consumers in China will choose import wine, attracting the entry of many international wine enterprises into Chinese market.

In 2009, Chinese wine import volume and value amounted to 171,231,332 liters and USD 441,697,229, increasing by 4.93% YOY and 22.91% YOY respectively. In 2009, Chinese import volume and value of bottled wine (no more than 2 liters each) reached 91,025 kiloliters and USD 377.11 million, rising by 58.3% YOY and 36.7% YOY separately. In the previous four months of 2010, Chinese import volume and value of bottled wine came up to 41,809.10 kiloliters and USD 177.51 million, growing by 76.5% YOY and 91.1% YOY respectively.

Import wine in Chinese market mainly includes the import bottled wine with original packing, the foreign bottled wine filled in China (foreign wine, foreign brand and filled in China) and the import base wine blended and filled by domestic wine enterprises and labeled with domestic brand (blending of foreign and domestic wine, Chinese domestic brand). Presently, the sales of import bottled wine account for over 5% in Chinese wine market, which is mainly provided in high-end markets such as star hotels and high-end clubs. In China, import wine is mainly distributed by wholly foreign-funded or joint venture sales companies and domestic small traders or distributors. Plus the import base wine blended and filled by domestic wine enterprises and labeled with domestic brand, the import wine takes up over 15% shares on Chinese wine market.

With superior advantages in raw material quality and cultural content, import wine has dominated Chinese high-end wine market. Import wine brands on Chinese market are mainly from France, Italy, Spain, Portugal, Germany, USA, Canada, Chile, Argentina and Australia, etc. The import wine volumes from France, Australia, Chile, USA, Italy and Spain, etc rank among the Top in China.

Chinese wine market is mainly occupied by medium-end and low-end domestic wines. Import wines impact home-made wines in price, quality and variety as well as encourage the improvement in the overall consumption level and volume of Chinese wine market.

In 2009, Chinese wine market was mainly dominated by the full grape juice wine. The dry and semi-dry wines accounted for over 50% in the market. Among dry wines, dry red wines occupied 80% while the rest 20% were taken up by dry white wines. Chinese wine product composition is gradually becoming rational.

Chinese grape wine enterprises represented by ChangYu, Dynasty and Great Wall have become the leaders in their own regional markets. ChangYu occupies an ascendant position in Shandong, Guangdong; Great Wall leads the wine market in North China; Dynasty has realized the high market share in Shanghai.

Many regional wine brands in China also enjoy high-speed development, including Weilong and Harvest in Central and South China, Suntime and Yunnan Red in West China and Tonghua dry red wine in Northeast China.

Chinese wine price is on the upward trend gennerally. With the popularization of the wine culture and the improvement in the consumption concept and capacity, the prices of mainstream wines in China have been raised from 20-40 CNY/bottle (750ml) to 30-60 CNY/bottle (750ml) by 2010.
With over years’ market cultivation, the healthy and fashionable wine drinking culture has gradually been accepted by Chinese consumers. The consumption demand for wine in China increases continuously.

Through this report, readers can acquire more information:
– Status quo of Chinese wine making industry
– Import and export of Chinese wine industry
– Consumer behaviors in Chinese wine industry
– Chinese wine sales channels
– Major enterprises in Chinese wine industry and their operation
– Influence of international financial crisis on Chinese wine industry
– Competition of import wine products in Chinese market
– Investment opportunities in Chinese wine industry
– Contacts of major wine making enterprises in China

Following persons are recommended to buy this report:
– Wine producers
– Wine importers and exporters
– Wine distributors
– Wine packaging enterprises
– Investors concerning the wine industry
– Research institutes concerning the wine industry

Table of Content

1. Overview of the Development of Chinese Wine Industry
1.1. Industry Development Environment
1.1.1 Macroeconomic Environment
1.1.2 Policy Environment
1.1.3 Consumption Environment
1.2 Operation Status of Chinese Wine Industry
1.2.1 Status of Chinese Wine Industry in the Alcoholic Drinks Industry
1.2.2 Overall Operation of Chinese Wine Industry
1.3 Analysis on Sales Channels of the Wine Industry
1.3.1 Domestic Wine Brands
1.3.2 Foreign Wine Brands

2. Analysis on Supply and Demand in Chinese Wine Market, 2009-2010
2.1 Analysis on Supply in Chinese Wine Market, 2009-2010
2.1.1 Production Capacity of Chinese Wine Making Industry
2.1.2 Analysis on Chinese Wine Making Industry by Region
2.1.3 Product Composition of Chinese Wine Making Industry
2.1.4 Supply Trend of Chinese Wine Making Industry
2.2 Analysis on Demand in Chinese Wine Industry, 2009-2010
2.2.1 Overview of Demand in Chinese Wine Market
2.2.2 Demand Structure
2.2.3 Demand Trend
2.3 Analysis on Import and Export of Chinese Wine Industry, 2009-2010
2.3.1 Import of Chinese Wine Industry
2.3.2 Export of Chinese Wine Industry
2.3.3 Import and Export Trend of Chinese Wine Industry
2.4 Analysis on Chinese Wine Prices
2.4.1 Retail Price Trend in Chinese Wine Market, 2009-2010
2.4.2 Factors Affecting Wine Price
2.4.3 Prediction on Chinese Wine Price, 2011

3. Analysis on Competition in Chinese Wine Industry
3.1. Overview of Current Competition in Chinese Wine Industry
3.1.1 Regional Competition
3.1.2 Brand Competition
3.2 Analysis on Factors Affecting Competition
3.2.1 Raw Material
3.2.2 Market Strategy
3.2.3 Other Factors
3.3. Analysis on Competition among Import Wines in Chinese Market
3.3.1 Competition Advantages
3.3.2 Competition Disadvantages
3.4 Prediction on Competition Trend of Chinese Wine Industry
3.5 Recommendations for Competition Strategy in Chinese Wine Industry

4. Analysis on Regional Markets of Chinese Wine Industry, 2009-2010
4.1 Analysis on the Wine Market in North China
4.1.1 Overview of the Wine Market in North China
4.1.2 Typical Wine Market – Beijing
4.2 Analysis on the Wine Market in Northeast China
4.2.1 Overview of the Wine Market in Northeast China
4.2.2 Typical Wine Market – Shenyang
4.3 Analysis on the Wine Market in Central China
4.3.1 Overview of the Wine Market in Central China
4.3.2 Typical Wine Market – Zhengzhou
4.4. Analysis on the Wine Market in East China
4.4.1 Overview of the Wine Market in East China
4.4.2 Typical Wine Market – Shanghai
4.5 Analysis on the Wine Market in South China
4.5.1 Overview of the Wine Market in South China
4.5.2 Typical Wine Market – Guangzhou
4.6 Analysis on the Wine Market in Southwest China
4.6.1 Overview of the Wine Market in Southwest China
4.6.2 Typical Wine Market – Chengdu
4.7 Analysis on the Wine Market in Northwest China
4.7.1 Overview of the Wine Market in Northwest China
4.7.2 Typical Wine Market – Xi’an

5. Analysis on Major Enterprises in Chinese Wine Industry (Top 10)
5.1 ChangYu Pioneer Wine Company Limited Yantai China
5.1.1 Overview
5.1.2 Operation
5.1.3 Development Strategy
5.2 Sino-French Joint-Venture Dynasty Winery Ltd
5.2.1 Overview
5.2.2 Operation
5.2.3 Development Strategy
Others

6. Analysis on M&A in Chinese Wine Industry
6.1 Analysis on M&A Situation in Chinese Wine Industry
6.2 Analysis on M&A Cases in Chinese Wine Industry
6.3 Analysis on M&A Trend in Chinese Wine Industry

7. Analysis on Factors Influencing the Development of Chinese Wine Industry, 2010-2011
7.1 Governmental Policies
7.2 Macroeconomic Environment
7.2.1 International Financial Crisis
7.2.2 Chinese Domestic Economic Environment
7.3 Consumer Behavior

8. Analysis on Development and Investment of Chinese Wine Industry, 2010-2011
8.1 Analysis on Development Risks
8.1.1 Policy Risk
8.1.2 Raw Material Risk
8.1.3 Market Competition Risk
8.1.4 Other Risks
8.1.5 Recommendations for Risk Aversion
9.2 Analysis on Development Trend of Chinese Wine Industry
8.2.1 Prediction on Market Capacity
8.2.2 Prediction on Product Trend
8.2.3 Prediction on Competition Trend
8.3 Analysis on Investment Opportunities in Chinese Wine Industry
8.3.1 New Product and Technology Opportunities
8.3.2 Channel Opportunities
8.3.3 Other Opportunities
8.4 Recommendations for Investment and Development of Chinese Wine Industry

Selected Charts
Chart Chinese Wine Production, 2005-2009
Chart Chinese Wine Market Scale, 2005-2009
Chart Import Volume of Bulk Wine in China, 2005-2009
Chart Import Volume of Bottled Wine in China, 2005-2009
Chart Chinese Wine Sales Channels
Chart Chinese Wine Consumption per Capita, 2005-2009
Chart Major Import Sources for Wine in China, 2009
Chart Major Import Sources for Wine in China, January-April 2010
Chart Operation of ChangYu Pioneer Wine Company Limited Yantai China, 2005-2009
Chart Major M&A Events in Chinese Wine Industry
Chart Retail Prices of Major Homemade Wines in Shanghai, 2009-2010
Chart Retail Prices of Major Homemade Wines in Beijing, 2009-2010
Chart Retail Prices of Major Homemade Wines in Guangzhou, 2009-2010
Chart Prediction on Chinese Wine Market Scale, 2010-2014

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