Latest China Customs data shows the continual decline of China’s wine imports, as the ‘zero covid policy’ upheld by the country with 52 million wine drinkers continues to weigh down on demand.
From January to March, wine imports to China plummeted 22% in volume to 84.1 million liters, compared to the same period last year.
In value terms, wine imports fell 21.1% to approximately RMB 2.23 billion (US$344.5 million).
With the surge of confirmed cases in March, China imposed the most severe restrictions on its most affluent cities that are also main drivers of wine consumption including economic center Shanghai, Guangdong’s Shenzhen and Dongguan across Hong Kong.
These restrictions and viral omicron outbreaks paralysed logistics and supply chain and are now becoming the country’s biggest threat for economic growth, on top of housing market crisis, Ukraine war and global interest rates, according to Bloomberg.
As we have previously reported, the closure of dining-in venues has greatly affected wine consumption, especially when wines are mostly drunk at social gatherings in China, according to Wu Yunping, Head of Shenzhen Wine Industry Association.
Home consumption was not strong enough to cover the loss as wine was not a priority during a time when residents had to scramble for basic necessities.
Wine distributors from Shenzhen also revealed mass-testing on supply chain workers and inconsistent regulations of different warehouses during lockdown have disrupted the delivery of their wine products.
Despite Shenzhen and Dongguan being free from curbs in late March, Shanghai entered its fourth week of lockdown on 18 April with plans to step up COVID-testing and control policies, as the city is now the epicentre of the new wave of pandemic. Its tally of daily new cases reached over 23,000 On Friday.
As Shanghai authorities announced the lockdown will be only eased when transmission is eradicated, it is likely that Shanghai will drag down China’s total wine imports in the next quarter.