China’s appetite for wine could send your portfolio into high spirits

Looking outside of the box for emerging sectors within China that could help your portfolio. According to International Wine and Spirit Research (IWSR), China consumed 1.9 billion bottles of wine in 2011, leaving the U.K. in the dust to become the fifth-largest wine consumers.

China also was the six-largest wine producer and eighth-largest wine importer in the world last year -- and their top source for imports was France.

As a trader, any time I hear China is importing and it's not related to a commodity, it's time to dig deeper!

Although Americans are still the top wine drinkers with 3.735 billion bottles of wine consumed last year, China's sure numbers suggest we may have competition in the near future.

Looking into the growth number in the world of wine, we find Europeans occupied 62 percent of the global consumption; however, the growth rate projection is only 0.4 percent between 2011 and 2015. Looking at the same period, is where traders should be excited to the U.S. market's growth will be around 10 percent while the China's market is predicted to be a staggering 54.3 percent, according to predictions of the IWSR.

The wine market in China which includes Hong Kong grew over 240% over the past five years with no signs of the wine consumption slowing anytime soon.

"China will be the fastest growing market over the next four years," IWSR CEO Robert Beynat said. The IWSR study predicts that the global wine consumption will grow 6.2% annually to reach 34.1 billion bottles from 2010 to 2015.

U.S. traders can access China's wine market through Constellation Brands Inc. ( STZ , quote ). STZ is a wine company with core markets in the United States, Canada and New Zealand.

STZ operates in four business segments: Constellation Wines North America (wine and spirits) (CWNA), Constellation Wines Australia and Europe (wine) (CWAE), Corporate Operations and Other, and Crown Imports (imported beer).

With China currently getting a large percentage of its imports from Europe STZ should be able to take advantage of China's appetite for wine.

Trader can look for break above $21.20 for STZ's next move upward.