Red Retreats, White Advances: Sluggish Wine Market Shifts Gears

Summary

Changyu A reported operating revenue of RMB 50.15 billion for the first three quarters of 2026, up 50.14 percent year on year, while net profit attributable to shareholders fell 50.13 percent to RMB 151 million. In the third quarter alone, revenue rose 50.12 percent to RMB 680 million and net profit jumped 50.11 percent to RMB 50.10 million, largely on a low base from the same period last year. Changyu said in its interim report that higher marketing spending to stimulate terminal sales, combined with cost changes from product mix adjustments, squeezed margins.

The global wine market is also subdued: Bordeaux Wine Industry Committee data showed that in the 12 months to the end of April 2026, Bordeaux winery shipments fell 11 percent year on year to 2.992 million hectolitres, dropping below 3 million hectolitres for the first time in modern records. In the 12 months to May 2026, export volume fell 8 percent and export value fell 15 percent, with export volume to China down 27 percent. White wine, by contrast, is growing against the trend.

Yang Zhengjian, dean of the WBO Wine Business School, said at the 2026 China White Wine Consumption Trends Summit that China's red-to-white ratio has shifted from 9:1 a decade ago to 10:2.5 to 3, with white wine approaching 30 percent of market volume. Dynasty white wine accounted for 62.8 percent of its revenue in the first half of 2026, while Qingdao Huadong Wine's share was close to 60 percent in 2025. With insufficient domestic dry white production capacity, companies such as Dynasty and Great Wall have begun importing bulk wine from New Zealand for domestic bottling.

Import data confirm the trend: from January to September this year, China's wine imports were about 160 million litres, down 5.3 percent year on year, while import value was about USD 1.17 billion, up 5.6 percent. In September, bottled wine imports from New Zealand reached 1.13 million litres, up 127.5 percent year on year, with import value up 50.1 percent, rising to third place among bottled wine source countries by value. German imports rose 59.9 percent in volume and 49 percent in value.

Liu Xixi, Greater China sales president of New Zealand brand Oyster Bay, said its single-month shipments in September were roughly equal to a full year in 2021. Jiang Changyu, general manager of the 1919 supply chain platform, said wine's share of 1919 terminal sales has fallen from around 18 percent to 6 to 7 percent, but white wine is growing strongly. Industry players also flagged risks of price competition and homogenisation: Tianjin wine merchant Wang Sheng said some New Zealand Sauvignon Blanc purchase prices have fallen from RMB 50 to 110 per bottle to RMB 20 to 30.

Wang Zuming, secretary-general of the wine committee of the China Alcoholic Drinks Association, said the industry needs to drive innovation in consumption scenarios and services, otherwise 'those who remain mere porters will eventually be eliminated'.

Commentary

China's wine market is undergoing a structural shift, with white wine's share of consumption jumping from 10 percent a decade ago to nearly 30 percent. For New Zealand small and medium-sized business owners, this trend is both an opportunity and a warning. As a key source of white wine, New Zealand saw bottled imports surge 127.5 percent year on year in September, with value rising to third place among source countries.

Oyster Bay's single-month shipments even matched its full-year level in 2021. However, signs of price competition have emerged, with some Sauvignon Blanc bulk wine purchase prices falling from RMB 50-110 to RMB 20-30, intensifying homogenisation risks. If New Zealand wineries rely solely on bulk wine exports or low-price volume, they risk being squeezed on margins.

Notably, insufficient domestic dry white capacity has prompted companies such as Dynasty and Great Wall to import New Zealand bulk wine for bottling, offering short-term opportunities for New Zealand bulk wine suppliers, though long-term risks include Chinese domestic capacity expansion or policy changes. On the other hand, the rise of new retail and instant retail channels is creating new consumption scenarios for white wine. New Zealand brands can reach young consumers directly through channels such as Sam's Club and Hema to build brand awareness.

New Zealand SMEs should focus on differentiation, such as the unique terroir of Marlborough Sauvignon Blanc, organic certification or sustainability stories, to avoid price wars. At the same time, they should monitor potential shifts in the competitive landscape from changes in China's tariff policy on Australian wine. Behind the white wine boom is a shift in consumption scenarios from banquets to self-indulgence.

New Zealand wine merchants need to understand the drinking habits of young Chinese consumers and develop products suitable for ready-to-drink, small-bottle or low-alcohol formats. In the short term, New Zealand white wine exports to China still have room to grow, but businesses need to balance bulk and bottled wine operations and prioritise brand building to benefit sustainably in a market shifting gears.

Keywords: white wine, Changyu A, Bordeaux, New Zealand wine, import volume, consumption scenarios, instant retail, price competition

Photo by AS_Photography on Pixabay

Source: Securities Times