China's Wine Industry Growing

China's wine industry is now in a period of supernormal growth with wine enterprises scattered across 26 provinces, autonomous regions, and municipalities nationwide.

China is now home to about 600 wine enterprises, 167 of which are state-owned earning annual sales revenues greater than 5 million yuan, located mainly in Shandong, Hebei, Jilin, Henan, Xinjiang,  Liaoning and Gansu.

The industry's output churned out 23.4 percent more year on year to 698,300 kiloliters in 2008, its gross industrial output value increased 27.02 percent to 19.17 billion yuan, and sales value reached 18.32 billion yuan, up 23.75 percent. Meanwhile, China imported 163,200 kiloliters wine.

China's wine industry concentration level is considerably high, as  the combined output of four leading brands, Changyu, Great Wall, Dynasty and Weilong, accounted for about 40 percent of the country's total.

The further development of the industry, however, will face several challenges, including insufficient policy supports, the absence of a  scientific layout for future development, laggard research and promotion of existing research results, and the lack of industry standards.

Additionally, the industry disappointed the market by providing only a limited selection of wines; mainly being dry red ones. The  industry's marketing system also failed to cater to China's local consumers.