Are they wrong about Hong Kong?

Apparently Hong Kong is fine wine’s future epicentre. But do consumption patterns support this? Where does China’s produce fit in? And what of the ‘Asian palate’?

Journalist Helen Savage considers the Asian wine market after a recent visit to Hong Kong.

According to Simon Tam, “No culture has ever embraced wine with the ferocity that we have.”  Tam, director of Hong Kong’s Independent Wine Centre, is a persuasive ambassador for all things wine in Hong Kong. And generous too, especially with Dom Ruinart 1998; but I find it hard to square his upbeat assessment with what I saw and heard in Hong Kong earlier this year.

Geordie Willis, Berry Bros & Rudd business development manager in Hong Kong, estimates that there are about 50,000 consumers of fine wine in a city of very nearly seven million people. Others suspect that the number is much less. Hong Kong’s annual per capita consumption of wine is a meagre three litres per head.

Apart from Simon Tam, no one I spoke to in Hong Kong thought that consumption would rise in the next few years. Most agreed with James Rowell of Altaya Wines that, “consumption is at a plateau”.

And yet after Hong Kong scrapped wine duty in February 2008, Berry’s are reported to have sold £4.6m of wine in 36 hours. Around a third of the world’s top auction buyers are from Hong Kong and Hong Kong collectors are said to hold about a million cases of fine wine in cellars in Europe and the US. A clutch of wine auctions held in Hong Kong for the first time in a decade have been a huge success. Is this why Robert Parker asserts that “Hong Kong will be the future nexus of the fine wine world”?

Part of Hong Kong’s bid to become the “fine wine hub of Asia” is to bring more fine wine to Asia. Crown Wine Cellars and others are working hard to supplement their existing storage facilities; but costs in a sub-tropical climate are very high, especially as Crown Cellars is proud to barcode every bottle it stores.

There is plenty of evidence that fine wines are drunk as well as collected and traded in Hong Kong and the local government hopes that the ready availability of fine wine will boost Hong Kong’s tourist industry, aimed especially at big-spending consumers from mainland China. As Rowell commented, “What do people do after visiting a couple of temples? They go eating, drinking and shopping.”

But I never saw a customer in any of the designer outlets in the spotless marble shopping mall below my hotel. And with hotels rumoured to be running at about 30% capacity, there is clear room for expansion.

The local authorities, and probably Beijing too, are keen to channel sales of wine to mainland China through Hong Kong. Despite the “financial tsunami”, they predict a vast increase in wine consumption on the mainland over the next decade; but more cautious voices believe that only a few, big, well-connected companies will make any real progress in the short term.

And no one in Hong Kong shows the slightest interest in trade in the other direction, despite Berrys’ own prediction that China may become the world’s biggest producer of fine wine within 50 years and has the “essential ingredients” to make fine wine to rival the best of Bordeaux.

Less blinkered is the local administration’s determination to focus not solely on showcasing the very best (like the 36 vintages of Pétrus on the wine list of my hotel restaurant, the Island Shangri La). They want to develop a market for “rising stars” that will retail around $50 to $60.

These appeal to younger consumers, professionals who look to non-European wines to provide the fruity, less tannic wines that Simon Tam believes appeal more to an Asian palate. A quarter of the sales of local specialist wine shops like Watson’s Wine Cellars is claret, but the French bubble may yet burst.

Some in Hong Kong dismiss the idea of an Asian palate. Others, Tam included, wisely point out that there are as many different Asian palates as there are different cuisines and cultures; but in November an all-Asian panel of judges, including Tam, will preside for the very first time at the International Wine and Spirit Competition. What will prove the perfect partner for Kung Bo chicken, Peking Duck or Dim Sung? I suggest Dom Ruinart ‘98 – with the lot.

Helen Savage, 17.09.2009