BEIJING: The country imported 505 million litres of wines, worth about US$1.9 billion in the first 10 months of the year, a year-on-year increase of 18.01% in value, according to data released earlier by the China Association for Imports and Export of Wine & Spirits. The fourth quarter, as forecasted by industry insiders, is expected to continue to grow in both volume and value terms as consumers are likely to stock up on wines for the upcoming Chinese Spring Festival on January 28, reported Chinese media ifeng.com.
A commentator on China’s food industry Zhu Danpeng, however, noted that the growth seen in the third quarter in particular was largely due to importers and retailers underselling their stocks, citing massive price cuts that have been rolled out by retailers, e-commerce shops and restaurants across China since the mid-autumn festival in September.
A Sichuan-based retailer, 1919 Wines & Spirits, which topped Tmall.com’s top selling wine shop list during its 9 September Wine & Spirits Festival, saw its gross profit drop by about 5% compared with 2015, despite massive increase in sales volumes, Zhu told the newspaper, explaining how the sales increase have driven down profit margins. “Sales growth gained by massive price cuts are vicious growth,” he said. One company that has reportedly been suffering of late is Dynasty Fine Wines, which, late last month, began selling off vast quantities of top Bordeaux.
