China’s wine production could see a jump, as the country removes key requirements to set up wineries and production in a move that’s seen to encourage domestic wine industry.
On August 10, China’s Ministry of Industry and Information Technology (MIIT) has issued an announcement that it has abolished a set of regulations that require companies to meet strict requirements to set up wineries with immediate effect, laying the ground for more companies to invest in domestic wine production.
The ministry also entourages wineries and relevant organisations to “play a more active role in self-discipline, maintaining market order and guiding the healthy development of enterprises,” the announcement says.
The news came at a time when all signs are showing the country is trying to revive its afflicted domestic wine production after years of decling production volume. Earlier president Xi Jinping visited China’s premier wine region Ningxia, a high-profile trip to lift Ningxia’s wine reputation and boost confidence in domestic wine industry.
A campaign is also underway to ask Chinese consumers to drink more Chinese wines.
The old rules introduced in 2012 titled “Conditions for Entry into the Wine Industry” would require a minimum production capacity for new wineries, using either estate groups or purchased grapes.
The annual production capacity for wineries that produce wine products from purchased wine (including imported wine) should be no less than 2,000 kiloliters, according to the 2012 regulation, while wineries that make estate wines using estate grown grapes, the production should be no less than 75 kiloliters (roughly 100,000 bottles).
Ditching the volume requirement could prompt more wineries to turn a focus on quality instead of quantity, especially when many wineries have severe problems of overstock amid weakened demand and competition with imported wines.
Last year, the country’s wine production dropped to 4.51 million hectolitres, according Chinese research institute Chinabgao, based on data collected by the institute and from China’s National Bureau of Statistics. This was less than half of the country’s wine production capacity recorded in 2017.