According to Cult Wines,pent-up demand in China could add fuel to the fine wine market at just the right time. As Europe and North America contemplate possible recessions in early 2023, high savings rates and an end to zero-COVID policies in China could improve the outlook for performance by keeping the global supply-demand imbalance in place.   

The wine market in China has seen a surge in activity in early 2023. Cult Wines’ first quarter trade sales in Greater China are on pace to reach the highest quarterly total since before the pandemic (Q1 2020) despite the lunar new year holiday interrupting business in January. The February pace is on track to set a new all-time monthly record for the region.

Demand has been seen for a range of wine regions and market tiers. At their current pace, Bordeaux sales in Q1 will more than double their average quarterly total from 2022, but Champagne sales are even higher with a Q1 pace 175% above the 2022 average. Rhone and Chile are also seeing healthy jumps.

What a difference a year makes. The hot start to 2023 contrasts with 2022 when China’s imports of wine halved compared to 2021 as the extended COVID restrictions weighed on economic activity. The abrupt end to the lockdown in late 2022 is likely a key driver of this recent jump in demand.

The question then becomes is this a short-term spike or the beginning of a meaningful recovery?