Pro Version | USD Change Currency | Help | Mobile Site
Advertisements

The Chinese in Bordeaux

Chinese jewelry magnate Shen Dongjun is the owner of Bordeaux's Château Laulan-Ducos
© AFP | Chinese jewelry magnate Shen Dongjun is the owner of Bordeaux's Château Laulan-Ducos
New Bordeaux investors are making the most of rapid growth in China’s wine market.

Numerous Chinese investors are diversifying their activities by buying up Bordeaux vineyards and leaving the estates' management in French hands. It's a win-win situation, thanks to the strength of the châteaux "brands" and the huge markets that China presents for Bordeaux wines.

"For years, I’ve been thinking about the same question: what industries are going to develop quickly in China?" said Shen Dongjun, owner of the Chinese jewelry chain TESiRO. "My answer is always the same: the wine industry." At the beginning of 2011 he acquired Château Laulan-Ducos’s 22 hectares of vines.

“With the growth, increasing numbers of Chinese consumers are learning to drink French wine and are falling in love with it," added the jewelry magnate. "The wine market is one of China’s biggest opportunities." And Shen posed the question: "What wine lover doesn’t dream of owning his own château?”

Latest figures for sales of Bordeaux wine in 2012 confirm the importance of China. With imports of 538,000 hectoliters (10 percent of production) China has become the top market by volume for the region, well ahead of Germany, Belgium and the United Kingdom – each of which imports around 250,000 hectoliters a year.

Just 10 years ago, wine was rarely consumed in China.

Delighted by these new sales records, Georges Haushalter, president of the Conseil Interprofessionel des Vins de Bordeaux (CIVB), stresses that Chinese investors “arrive with plenty of ambition,” and are looking to “increase quality further in investing in this framework.”

This is very much the case at Château Monlot, seven hectares of grand-cru vines in Saint-Émilion, bought in 2011 by the actress Zhao Wei. They are managed by one of Bordeaux’s most celebrated enologists, Jean-Claude Berrouet, who has worked on 44 vintages for the legendary Château Pétrus.

“The goal is to lift the quality of the wine so as to lift it to the most prestigious level, to be a point of reference,” says Berrouet, revealing that investment in a new fermenting room and barrel storage has been undertaken “to give us the means to reach this goal.”

An employee at work in the cellar of Château Laulan-Ducos
© AFP | An employee at work in the cellar of Château Laulan-Ducos

The Chinese have been carefully moving in on the Bordeaux wine scene since 2008, buying up properties below 5 million euros ($6.4 million). In 2011, the trend picked up with the buyout of a number of châteaux, which in some cases had been on the market for some time. Today, around 30 properties are owned by businessmen or finance houses from China.

Jacques Dupont, specialist wine writer for the weekly magazine Le Point, explains that “at first, their purchases were guided by the architecture of the buildings,” along with a desire to appropriate for themselves some of the culture and history of France. "But the goal being to make money, they’ve acquired vineyards capable of producing high volume."

For investors with a foot in the Chinese wine market, "owning a vineyard in Bordeaux brings with it credibility and prestige,” says Thomas Julien, the CIVB’s representative in China. “For others it’s an exercise in public relations, allowing them to host clients in a beautiful French heritage building." He notes that “Bordeaux is to wine what Paris is to luxury.”

Li Lijuan is a negotiator who worked on the 2012 buyout of Château Grand Mouëys by Zhang Jinsan, head of the NingXia group, China’s top producer of alcoholic beverages. She believes that such investors are also motivated by the search for a sound property investment: one of these Bordeaux châteaux costs only “as much as a large apartment in Hong Kong.”

She emphasizes that Bordeaux is “also of interest because of the luxury of the Atlantic coast with its casinos and wine tourism,” adding that at Grand Mouëys, the guest rooms are intended for Chinese luxury tourism.

Wine négociants perhaps have most to fear from these new arrivals. By producing their own wines, the Chinese owners plan to cut out the middle man and his margins by directly selling the whole of their harvests in China through their own distribution networks.

But according to Haushalter, himself a négociant, the “Bordeaux trade is used to this attitude.” He believes that the Chinese “will in time see the importance of having markets throughout the world and a diverse client base,” which the local négociants can supply.

Shen Dongjun acknowledges that he originally envisaged exporting the whole of Laulan-Ducos's 120,000 bottles to China, but is now planning to “develop other markets.”

Apart from two major companies, King Power, a distributor of luxury brands, and Cofco, a state-owned import-export business, the investors come from a range of backgrounds. They are often businessmen who are keen to diversify their interests through their enthusiastic entry into the world of wine, and at the same time make money.

France’s super-wealthy won’t be arguing against such a strategy. The Rothschilds and Dassault were first, but other newly wealthy CEOs such as Arnault, Pinault, Bouygues, Bolloré and numerous others have followed. Over the last 15 years, they have turned their diversification into vineyards, especially in Bordeaux, into enviably flourishing businesses.

Signup for our Free Weekly Newsletter


Write Comment


Recent Stories

Numbers were down at Bordeaux's en primeur week

2013: Bordeaux's Divided Year

2013 was a vintage from hell for Bordeaux producers, but merchants are finding a bright side.

Bordeaux's Not So Greatest Hits

Jane Anson checks out some past Bordeaux vintages that make 2013 look positively stellar.

Oregon's Five Grand Cru Sites of the Future

With Burgundians arriving in their droves, Katherine Cole considers which Oregon vineyards have the potential to be the equivalent of a Burgundy grand cru.

Napa Caught Napping in American Appellation Race

How a small town in Missouri beat Napa to become the first American Viticultural Area.

Where Now For Crimean Wine?

The future of Crimea is uncertain and the local wine industry is wondering how the unrest will affect it.

Rapper Endorsement Puts Luc Belaire Rosé on Most-Wanted List

A French sparkler has emerged from the rear to grab a spot on Wine-Searcher's list of the 100 most-searched-for wines.

Chilean Immerses His Wines in Jazz

Can music change the taste of a wine? A recent experiment seems to suggest so.

Moving Military Technology to the Winery

Military technology isn't just about blowing the other guy to smithereens – it can also help you enjoy that glass of Pinot sooner than you thought.

How Long Before Napa Cabs Top $1000 A Bottle?

With 12 Napa wines selling for at least $1000 a bottle wholesale at Premiere Napa Valley, can the same price for regular releases be far behind?

British Government Stocks Some "Jolly Good" Wines

From $7 Chilean merlot to mature first growths, the British Government's cellar has a drop for all-comers.

Slow Cooking With Rollan de By's Jean Guyon

Melt-in-your-mouth beef cheek recipe

Burgundy's Spiraling Prices: Fact and Fiction

Burgundy vintners pray to St. Vincent for a bigger crop while consumers cross their palms with silver.

Berenice Lurton's Sweet and Salty Chicken

The head of Barsac's Château Climens shares her favorite recipe.

America vs. Europe: The Organic Divide

W. Blake Gray explores the debate over organic wine between the U.S. and the European Union.

Tim Adams' Lamb Shank Special

Slow-cooked lamb and a Clare Valley red is on the menu at Tim Adams' house.

 
Site Map About Contact Business Advertising Social