Foreign wines gaining ground

While sales of some well-known Chinese liquors have fallen lately, the demand for foreign brands continues to grow at a rapid pace.

China's market for imported alcohol is expected to experience explosive growth, according to the projections of local liquor sellers and wine experts.

Tong Ye, a manager of Vats Liquor Store, one of the largest liquor stores in Beijing, expects a 30-percent rise in sales of foreign wines from last year.

2011 sales totaled around 2 billion yuan ($320 million) for the store, which sells expensive foreign wines and top-end baijiu, a Chinese liquor, as well as domestic wines.

Because the serving of luxury baijiu at State functions has come under public scrutiny, Tong expects sales of Moutai and Wuliangye, two of the most sought-after white spirits, could drop by 10 to 20 percent in sales this year at her store.

Wines sales could conceivably shoot up by 40 to 50 percent this year, predicted Lu Jiang, a Bordeaux Wine Council certified trainer and wine consultant.

Tong said more middle-class Chinese are choosing wine over baijiu because they are beginning to realize wine is better for health.

Dong Hongxia, a senior customer manager of Golden Chateau, a wholesale wine importer in Beijing, said now corporate or institutional purchases of imported wines account for only 2 to 3 percent of the company's total sales. People buy wines mainly for weddings, gifts and other social activities, Dong said.

Statistics from China Customs show that in 2011, Beijing imported nearly $93.6 million worth of wine, almost double the figure of the previous year.

The total sales of foreign wines in Beijing were estimated to be between 300 million yuan and 350 million yuan last year, according to the China Industrial Competitive Intelligence Network under the Ministry of Commerce.

While growth in foreign wines far outstrips that of local brands, the total Chinese and foreign wine market in Beijing is valued at about 1 billion yuan and is expanding at an annual rate of 15 percent, according to the China Industrial Competitive Intelligence Network.

As one of the largest wine markets in the country, Beijing boasts an aggregate yearly sales volume of 39 million liters, or more than 50 million bottles of wine.

While sales continue to rise, the price per bottle has dropped due to lower tariffs on wine imports, more choices and greater price sensitivity in the market, Lu said.

Chinese wine sellers have begun to impose markups on imported wines due to booming domestic demand. A bottle of wine that sells for 2 to 3 euros ($2.61 to $3.91) in France could be 300 yuan in China.

In addition to upscale brands from premium French chateaus, such as Chateau Lafite and other well-known luxury wines, French brand Castel and Australia's Jacob's Creek are also becoming more popular among Chinese consumers and fetching 100 yuan to 800 yuan per bottle.