Chinese Mandarin - Working on a dream: fine wines

CHINA / Foreign Media on China

Working on a dream: fine wines
By DONALD GREENLEES (NYtimes)
Updated: 2006-07-04 15:09

http://www.nytimes.com/2006/07/04/business/worldbusiness/04wine.html?_r=1&a
mp;oref=slogin

HONG KONG, July 3 �� It was not an obvious place to put a vineyard. The
ground was barren and stony. In winter, temperatures could drop below
freezing and the wind blew cold and hard.

In October 2000, however, Nicolas Billot-Grima decided to build a winery,
far from his native Bordeaux, within sight of the Great Wall of China, 43
miles northwest of Beijing.

"The field was totally no man's land," Mr. Billot-Grima said. "It was
nothing. It was rocks. And the idea is to do something where no farmer
will use this unfertile land."

Despite the harsh weather and terrain, Mr. Billot-Grima, whose family has
produced wine for six generations in southwest France, decided he had
found his terroir �� the blend of earth and climate that winemakers seek
to give vintages a unique character.

Here, he would embark on an ambitious experiment to produce wines of high
quality in the French tradition. He would join a small number of
winemakers trying to turn China into a respected wine producer, alongside
other non-European producers like the United States, Chile, Australia and
New Zealand, with the capacity to export and to meet the needs of a more
demanding domestic market.

In recent years, newly affluent Chinese professionals have been
abandoning beer and potent local spirits for the refined taste and image
of grape wine, in contrast to the relative decline in wine consumption in
some parts of the developed world that has led to a global oversupply.

Wine consumption in China, including Hong Kong, is forecast to grow 78
percent in the 10 years to 2009, according to a study by The
International Wine and Spirit Record in London. This means Chinese wine
consumption will grow more than seven times the forecast average for the
rest of the world.

By 2009, the Chinese are expected to drink 766 million bottles of wine,
up from 500 million in 2004.

With 95 percent of sales going to domestic brands like the top sellers
Great Wall, Dynasty and Dragon Seal, Chinese wine production is
increasing to meet the new demand. According to The Record, Chinese
output is on target to grow by 50 million liters, or about 13 million
gallons, to 420 million liters from 2004 to 2010.

The increase comes as subsidized European winemakers are under pressure
to cut production and reduce the so-called wine lake �� the surplus wine
that often ends up being transformed into industrial alcohol.

While wine producers in Europe are being asked to produce less and focus
on quality and competitiveness, the challenge in China is to make a giant
leap in standards. Most Chinese wines are barely palatable to anyone
accustomed to wines from Europe and other well-established producing
regions. Last November, the magazine Wine Spectator found at a tasting of
typical Chinese wine that "both reds and whites were achingly sweet,
tended to be high in alcohol, and resembled vermouth or sherry, with
flavors of raisins, toasted nuts, orange peel and hard candy."

But a new breed of winemaker in China, backed by foreign investment and
technical advice, is trying to change that reputation. The aim is to keep
pace with the evolving tastes of more widely traveled and sophisticated
Chinese and to compete with other wine-producing nations, which see China
as a rising and potentially huge market.

"As the market is opening to international wines, there is a real concern
by the Chinese wineries to increase the quality of their wines to make
them more competitive with international tastes," said Dominique H��riard
Dubreuil, chairwoman of R��my Cointreau, which owns 24 percent of Dynasty
Wines in Tianjin, China.

Some winemakers in China are dreaming of the day when Chinese wine might
be of export quality in a world market where imports account for an
increasing share of consumption, even in wine-producing nations.

In his five-year-old vineyard in Hebei Province, 600 meters, or 2,000
feet, above sea level, Mr. Billot-Grima has made a start on that ambition
in what he named Chateau Tayshi. He planted his imported French vines in
May 2001 on 50 acres. The red wines would blend merlot, cabernet
sauvignon and cabernet franc; the white wines would be chardonnay and
sauvignon blanc.

It was not an easy beginning. Chinese customs officials held the imported
vines in quarantine for two months. Then, his farmers objected when he
wanted to cut the first grapes and let them rot on the ground to improve
the soil. But by 2004, Mr. Billot-Grima had produced his first wine �� a
chardonnay.

"It was amazing," he said. "All of us were surprised by the quality."

A certain amount of French prestige has been riding on his success. He
established Chateau Tayshi with his Hong Kong business partner, Bosco
Wang, after winning a French government contract to build a winery as a
"demonstration project." The venture's goal was to help nurture the
Chinese wine industry's effort to achieve high quality. Because it is a
demonstration project, Chateau Tayshi's production is likely to peak at
about 150,000 bottles a year.

"We don't want to be big," Mr. Billot-Grima said. "We only want to
produce quality wine." But he added: "We are thinking about export. I am
sure we will export to Japan and America."

At a wine and spirits show, Vinexpo, held in Hong Kong in May, six
Chinese winemakers set up stands alongside the finest European and other
producers, signaling their aim to compete. Industry experts estimate that
of about 400 wineries in China, a quarter have some hope of achieving
good quality.

One of those to exhibit was Grace Vineyard, which was established in 1997
by a Hong Kong businessman, Chan Chun-keung. The 200-acre winery is in
Shanxi Province in northern China.

"One day we hope people will try our wine and say this is great Chinese
wine, like people speak of a great French or Australian wine," said Judy
Leissner, the 28-year-old chief executive and daughter of the winery's
founder.

Yet, before wine producers elsewhere start to tremble at the prospect of
China's flooding the already saturated global markets with inexpensive
wine of reasonable quality, winemakers concede that China is still a long
way from being internationally competitive. Furthermore, the size and
growth potential of the Chinese market are likely to keep Chinese wine
producers busy at home. Many of those producers are importing low-cost
wine in bulk and rebottling it to make up for a domestic shortfall.

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