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China's winemakers call for probes on EU imports

(Xinhua)

08:25, August 21, 2012

BEIJING, Aug. 20 (Xinhua) -- Wine producers have applied to the Ministry of Commerce (MOC) demanding investigations into whether European imports are damaging China's domestic market.

Wang Zuming, head of the wine division of the China Alcoholic Drinks Association, told Xinhua, that winemakers want the ministry to look into the increasing amount of EU imports and its impact on the domestic industry.

EU wine imports surged to 169,114 kiloliters, in 2011, from 35,944 kiloliters, in 2008, at an annual pace of 67.71 percent. In the past four years, its market share in China increased from 4.94 percent to 14.76 percent, Wang said.

Almost every Chinese winemaker has felt the impact from the EU, he said.

The EU has provided various subsidies to the wine industry, putting Chinese makers at a disadvantage, Wang added.

Due to the EU's producing capacity and export potential, Wang argues that this can only have a negative impact on winemakers in China.

The EU is the world's largest wine-producing region with an annual output reaching around 16 million tonnes, or 69 percent of the world's total.

Winemakers from the EU see the Chinese market as having huge potential.

China's wine consumption surged 28.26 percent to 1.55 million kiloliters in 2011, overtaking the United Kingdom to be the fifth largest market, according to data provided by industry. Imported wines accounted for nearly one-third of the market, up from less than 10 percent in 2006.

As foreign wine merchants tap into the Chinese market, local winemakers are starting to feel the pressure. The industry's average gross margin slipped to 30 percent from around 40 percent, said State-level Wine Appraisal Judge Sun Fangxun.

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