Bordeaux Grand Cru Classé exports to Greater China have extended their downward trajectory, falling to EUR 240 million in the 12 months ending July 2024.
This marks a further decline from last year’s record low, as revealed by Union des Grands Crus de Bordeaux (UGCB) President Ronan Laborde during a press conference in Hong Kong on November 22.
Hong Kong Retains Top Position
Hong Kong remained the leading destination for Bordeaux wines in the region, accounting for EUR 140 million in exports, while exports to mainland China dropped to EUR 100 million. Despite the decline, Laborde highlighted Bordeaux’s continued dominance in the French Grand Cru market in Greater China, where its wines constitute between 67% and 75% of the total value of imported French Grand Crus.
“While the figures have fallen, they are still substantial,” Laborde remarked, emphasizing the region’s reliance on Bordeaux as a luxury wine staple.
A Historic Low for Greater China Exports
The combined export value to Hong Kong and mainland China represents a steep decline from the EUR 300 million recorded during the same period last year, which itself had been a historic low. The downturn reflects broader challenges for Bordeaux, with global exports of Grand Cru Classé wines decreasing by 16% year-on-year.
This decline follows record highs in 2021 and 2022, when Bordeaux Grand Cru exports reached EUR 1.4 billion globally. Laborde noted that these years were extraordinary and not reflective of long-term trends, making the current contraction part of a broader market correction.
Shifts in Global Markets
The decline in Bordeaux exports was not confined to Greater China. Of Bordeaux's top 15 global markets, only Thailand, the United Arab Emirates, and Taiwan saw growth during the same period.
Thailand’s increase was particularly notable, fueled by the government’s removal of import tariffs and reduced excise taxes on wine. Laborde compared this development to Hong Kong's abolition of wine duties in 2008, which transformed the city into a global fine wine hub and continues to sustain its strong demand for Bordeaux wines.
Geopolitical Tensions Add to Uncertainty
The future of Bordeaux exports to Greater China remains uncertain amid escalating geopolitical tensions. Rising trade disputes between China and the European Union, particularly over electric vehicles, solar panels, and brandy, could pose additional hurdles.
Laborde acknowledged these challenges but expressed confidence in the resilience of Bordeaux’s wine producers. Reflecting on previous crises such as Brexit and U.S. tariffs on French wines, he said, “We are more vaccinated now and ready to face any situation.”
Adapting to a Changing Landscape
Looking ahead, Laborde reaffirmed the UGCB’s commitment to maintaining a strong presence in Greater China. “If barriers arise, we will find solutions to continue selling a decent quantity of wine there,” he assured stakeholders, hinting at potential legal and strategic measures to counter market disruptions.
Navigating a New Normal
As Bordeaux adapts to shifting global dynamics, the region faces an evolving landscape where traditional markets are under pressure, and emerging ones hold promise. The UGCB’s proactive approach and determination to navigate geopolitical and economic challenges will be critical in sustaining its legacy in Greater China and beyond.
With the global fine wine market in flux, Bordeaux’s ability to innovate and adapt will determine whether it can regain momentum in its historic strongholds and capitalize on new opportunities elsewhere.
Source: Vino-Joy