A Look at China's Growing Wine Industry

China’s recent economic growth has led to a new middle class with a thirst for European-style wine. Today, China is the world’s largest red wine market – the value of Chinese demand for wine is estimated to reach a value of US$21 billion by 2020.

While Chinese people mostly prefer imported wines, domestically produced wines are on the rise. With entrepreneur winemakers opening new vineyards left and right, the industry’s rapid growth is slowly beginning to make its mark in the rarified world of premium wine.

One of China’s most exciting new wine regions lies in the Ningxia Hui Autonomous Region in northwest China. Once a poor coal mining region, Ningxia is now the heart of Chinese wine production, with over 200 registered wineries. Ningxia’s high altitude, dry summers, and plentiful sunlight are ideal for grape growing. However, the region also experiences harsh, freezing winters, making it necessary for winemakers to bury their vines until spring to protect them from the cold.

Even foreign companies have recognized Ningxia’s potential — in 2013, French conglomerate Moët Hennessy opened a 6,300-square-meter winery in Ningxia, producing sparkling wine under the Chandon brand.

Another notable wine region is the Shandong Peninsula. Home to Changyu Pioneer Wine Co., founded in 1892, Shandong has a long history of wine grape cultivation compared to other parts of China. Other major players include the eastern province of Shanxi, home to the highly regarded Grace Vineyards, the tropical and hilly Yunnan province in the southwest, and Xinjiang Autonomous Region, a remote, sandy province in northwestern China.

China’s top wines are deemed competent and drinkable, although they often fall short of the complexity and character of premium wines produced in age-old winemaking regions such as France and Italy.

The common perception of Chinese wine is that it must be bad. However, more and more critics are beginning to appreciate Chinese wine. Some of China’s most well-regarded wineries include Silver Heights, Grace Vineyard, Chateau Changyu, and Xixia King Winery. In 2011, Grace Vineyard’s 2009 Chairman’s Reserve and Silver Heights’ 2009 “The Summit” placed first and second in a blind tasting competition, beating a crop of commercial French reds.

Chinese wines are still relatively unknown outside of China, as they are rarely exported. Even domestically, Chinese wines are less popular than prestigious imported brands. And while a few Chinese wines have gained media plaudits and picked up international awards, one major challenge for the Chinese wine industry is the lack of a classification system that helps consumers distinguish top quality wines from mediocre ones.

Nonetheless, the popularity of Chinese wine is expected to grow dramatically over the next decade or so as the industry matures and common perceptions gradually shift — so let’s raise a glass to the future of Chinese wine.