New Asian Wealth Changing the Balance of Power in the Wine Market

New Asian Wealth Changing the Balance of Power in the Wine MarketDoes anyone remember that Germany and the UK were once two of the world’s largest importers of fine wine from Bordeaux? It wasn’t that long ago, but their places on the list have now been lowered as China took over the fifth spot. When the Chinese entered the wine market, few believed that it would cause such a major upset in the balance of wine consumption, but it has succeeded to do just that. And when it comes to the region’s Bordeaux exports, China and Hong Kong hold the keys, as they account for more than 60% of that market. New York, which was once considered to be the world’s wine auction capital, had to pass that title on to Hong Kong when its total sales amounted to some USD $155m. According to Hon John Tsang Chun-Wah, who is the financial secretary in Hong Kong, through newly developed ties with the wine world, Hong Kong now views wine as not only good for the stomach, but for the bank account as well.

Triggering Change

Since 2009, China has been gaining strength in the wine world after hosting a series of wildly successful auctions, an event which lasted six days. Following some record-breaking sales that took place during those days, China has been steadily emerging as a powerful player in the market. The Chinese people have changed from buying fine wine only for consumption and now consider it to be a worthy investment as well as a top choice in gifting. Senior Market Analyst, Daniel Paterson, points to three points that helped trigger these buying trends. The first is the generous government stimulus, the second is soaring stocks in Shanghai and the third is an explosive property market. Put these three together and you get Chinese tycoons that are the world’s highest net worth individuals, who view wine as a prestigious “must have.”

In short, Asians now have a lot of money, and are making the decision to invest it in something that not only safeguards its value, but is likely to appreciate in the coming years.

Lafite as the Preferred Gift of Chinese Millionaires

A new study published in the Chinese Millionaire Wealth Report shares the secret of giving gifts to ultra wealthy Chinese men. It seems that watches are the most coveted gift followed closely by a fine bottle of red wine. Appreciation of the best wines has been growing since the Chinese became a dominant force in fine wine trading in 2009 after organizing a series of Sotheby’s wine auctions. At that event, a bottle of Chateau Petrus exceeded all estimates when it reached a price tag of £58,000. With a strong entry into the world of wine, no one doubted that China was on its way to becoming an international capital for trading in fine wine. The early Chinese market bought wine for its own consumption, but it has now matured into a solid player on the international wine scene.

BWC Management & ConsultingWine that Reaches Cult Status

When the movie God of Gamblers aired in 1989, few Chinese had ever heard of Lafite. But that all changed when a movie star from Hong Kong, Chow Yun-fat spoke the famous lines, “Uncork me a bottle of 1982 Lafite.” Lafite Rothschild became a status symbol overnight and even reached cult popularity. With the increased demand for Lafite, the limited stock became even dearer. According to BWC Managing and Consulting’s senior private portfolio manager, Samuel Cheung, vintage from Chateau Lafite Rothschild will continue to be a source of consistent returns. An increasing number of wealthy individuals in China choose Lafite as a tangible asset that holds its value while consistently appreciating each year. Besides being an excellent investment, Lafite Rothschild is the single brand of wine that is on the top fifteen brands that male millionaires prefer to receive as gifts.

So if you are looking for ways to make a Chinese millionaire happy, give a gift of Lafite!