China’s wine production down in 2016

China, currently ranked as the world’s sixth biggest wine producer by QIV, is expected to see a decrease in production in 2016 as major wine regions in the country including northwestern Xinjiang, Ningxia and eastern Hebei provinces reported losses of grapes in 2016 due to bad weather and local farmers’ replanting of vines with other crops.

A vineyard in northwestern China was flooded earlier this year due to heavy rainfall (Photo credit: Wine Business Observation)

A local winemaker from Xinjiang in northwestern China, Wang Liping, estimated that production in Xinjiang alone is forecast to see at least 30% drop this year.

White grape production in Xinjiang’s Yanqi, Heshuo dropped at least by one third, He Kuanchun, chief winemaker and general manager of Xijiang Milan Angel winery told Chinese media the Wine Business Observation.

Meanwhile, production in China’s eastern Hebei Province dropped by at least 20% based on estimates by Beijing Long Ze Shang Gu Wine Trading company’s chairman, Li Xinxin.

During the year, Xinjiang’s northern region was assailed by pests and diseases after heavy downpours, while in the southern region of the province vines were subject to strong winds that uprooted many vineyards, Yang Weibing, secretary general of Xinjiang Changji Wine Association, told the news outlet.

Hailstorms in July that followed heavy rainfall in June caused massive damage to the vines in Xinjiang and Ningxia, especially those planted near mountain areas, Wang added.

In addition to diseases and weather calamities that led to wine production decline, Chinese oenologist Li Demei noted a decrease in grape acreage in Ningxia, Xinjiang and Hebei contributed to the drop as well.

Since last year, some local growers have apparently started to cut down vines and replace them with more profitable crops due to the thin margin and weak market demand for domestic wines.

In Xinjiang, grape prices have dropped to RMB 1 (€0.14) per kilo, and in Hebei, local farmers are selling grapes less than 1 RMB a kilo, dampening local farmers’ confidence in grape growing, driving them to other alternatives.

This is likely to drive up prices for higher end wines produced from Xinjiang, according to Wang. But overall, prices will remain stable as many of the wineries still have stocks saved up in warehouses, added Yang.