In Greater China, what are the most popular wines at auctions right now? How do auction houses know wines are genuine? Are wine auctions only for the rich? Find the answers from DecanterChina.com’s exclusive interview with Austin Zhang of Christie’s China.
The wine auction business in Asia
When Hong Kong abolished its import tax on wine in 2008, it immediately became a hub for wine auctions in Asia. Four out of the five main global auction houses for wine and spirits - Acker, Zachys, Christie’s and Sotheby’s - have pitched their business in Hong Kong.
The wine sales of the auction houses in the world seem to have peaked in 2011. With Bordeaux fine wine prices collapsing, the auction market went through a period of adjustment in 2011, becoming more stable in 2013 and 2014, said Austin Zhang, Associate Vice President and Wine Specialist of Christie's China.
Hong Kong and the Mainland
At wine and spirits auctions, it is mostly wines that are being sold in Hong Kong, plus a small portion of whisky.
That is rarely the case in the Mainland, where Baijiu (Chinese white spirits), namely Maotai, usually occupy the majority of the lots. For example, in 2014 Maotai took up 50% of the sales, whereas wines only accounted for 5%. ‘The amount of wines being sold through auctions is actually very small in Mainland China,’ said Zhang.
The reason behind the difference is firstly a ‘cultural’ one, as Baijiu is still the mainstream for Mainland drinkers. Another reason lies in the 48.2% import tax on wines payable when the wines enter Mainland China.
‘We do think that the Mainland is an important market for us. However, the high tax rates create great difficulties for us to source commercially viable wines to sell in Mainland China,’ explained Zhang, adding that this is why the London-based auction house is still the centre of its Asia activities in Hong Kong.
But that wouldn’t stop Mainland buyers from attending auctions in Hong Kong.
It is difficult to calculate the exact percentage of Mainland Chinese buyers, said Zhang. Many of them, though living in the Mainland, tend to register for Hong Kong auctions using the address of their properties in Hong Kong, Singapore and New York. But if they are included, ‘Mainland buyers can take up a significant percentage of buyers in Hong Kong auctions’.
Christie’s and Mainland China
Christie’s started its journey in the Mainland by setting up representative offices in Shanghai and Beijing in the 1990s. In 2013, Christie’s was finally granted with an auction license and officially started its independent operation in China.
In recent years, the total wine sales bought by auctions in Asia is dropping. This was more due to the fact that many Chinese buyers are bidding at auctions abroad, mainly in London and New York, said Zhang. To support buyers who wish to bid overseas, Christie’s China now serves more as an agency, by delivering bidding documents and helping with the logistics.
Read on the next page:
Spotting the fake wines
The ‘preferences’ of New York, London and Hong Kong auctions
The most popular wines in Asia
Austin’s tip for consumer: Are wine auctions only for the rich?
Translated by Sylvia Wu / 吴嘉溦
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