China’s trade threat leaves bitter taste in French wine world

China’s trade threat leaves bitter taste in French wine world

10:26am EDT

By Muriel Boselli and Catherine Bremer

PARIS (Reuters) – Beijing’s salvo at European wine exports has brought into focus simmering French unease about the growing power the Chinese wield over their cherished vines, as consumers, investors and even chateaux owners.

Responding to an EU move to impose duties on Chinese solar panels, China launched an anti-dumping inquiry into European wine sales this week that could lead to exporters in France, along with Spain and Italy, being hit with retaliatory duties.

The French government reacted angrily and indignant producers of Bordeaux – which China’s wealthy have developed a seemingly unquenchable thirst for – snorted that they had nothing to do with solar panels.Sniffy remarks from Parisian sommeliers and Pyrenean vineyard owners betray a culture clash between a nation fiercely proud of its ceremony-laden wine heritage and squeamish at shows of wealth, and a Chinese nouveau riche for whom bagging a grand cru is more about status than accompanying a roti de porc.

EU wine exports to China excluding Hong Kong, which EU officials said was not covered by the announcement, reached 257.3 million liters in 2012 for a value of nearly $1 billion. More than half – 139.5 million liters – came from France.

China is now the top destination for Bordeaux reds. Millionaires shell out thousands of euros at auction for the dustiest bottles. Chinese entrepreneurs have also snapped up several dozen of the less illustrious chateaux, most of them in Bordeaux, out of the several thousand in France.

“The high-priced wines (they buy) are trophy wines more than anything else,” said David Ridgeway, the British head sommelier at La Tour d’Argent, a lavish four-centuries-old Paris eatery as famous for its wine cellar as for its signature duck dishes.

“The Chinese have pretty amazing parties where they open up hundreds and hundreds of very expensive bottles to perform and show off their money, a bit like the Russians a few years ago.”

Many Chinese visitors now roam France’s sun-kissed wine terrains scooping up boxloads of wine, often to the chagrin of vineyard owners upset that they do not take the time to taste, spit and hum and haw as Europeans and Americans do.

In the southwestern village of Labastide-Saint-Pierre, near Toulouse, brother and sister team Anne and Gerard Arbeau, the fourth generation in their family producing a “Frontonnais” wine, fear a trade spat would undermine their work trying to break down barriers.

WINE FOR MEN – AND COOKING

They export one third of their annual production of 1.8 million bottles, some under enticingly French labels like “Amiral Louis” and “Seigneur Coutinel” to China, and feel they have been taken hostage by the Chinese government’s threat.

“It takes a while for them to understand the product,” Anne Arbeau told Reuters at the 130-year-old vineyard. “They have different customs, different ways of doing things. We’ve had to adapt to their mentality, to their culture and their taste.”

“We shouldn’t be the ones that have to pay for the solar panels,” she added.

She said she got an order on Thursday morning for 42,000 bottles extra from a Chinese client who said he wanted to get more in before any new duties were imposed.

Arbeau, who travels to China four times a year and welcomes Chinese clients each month, is one of a growing number of French business people – like those who let out historic castles to Chinese couples seeking Disneyland weddings – to accept that as Europe languishes in recession, China is where the money is.

The phenomenon is ever more visible in Paris, where rich Chinese customers pack luxury goods stores, Chinese textile businesses whirr away in quiet city backstreets and tobacconists are increasingly run by Chinese people.

Chinese owners are even setting up wine shops in Paris, although several visited by Reuters did not speak French.

Some serve Chinese residents in the capital where, despite a language barrier, some of France’s wine culture is seeping into the growing community.

“Chinese wine is cheaper and of poorer quality. French wine is more romantic, we often drink it at romantic dinners,” explained Yang, 30, a cashier at a Chinese wine shop in Paris.

“Chinese wine is mainly used for cooking,” she added. “The only ones who buy it to drink are men who drink it together.”

If the Chinese are starting to appreciate French wine, it could be years before the French get a taste for what Chinese growers produce at their chateaux.

“They have large planted areas but most of what I’ve tasted so far has not been particularly brilliant,” said Ridgeway, noting the Chinese vines are at most a decade-old and it took French vines 1,000 years or so to evolve.

(Additional reporting by Jean Decotte in Labastide-Saint-Pierre, Gus Trompiz and Sybille de la Hamaide in Paris; Writing by Catherine Bremer; Editing by Mark John and Pravin Char)