Recent days have shown the major importance not only of the future of Cognac in general, but how vital the Chinese element of this really is. Only days after Remy Cointreau releasing figures showing increased sales of Cognac, the region welcomed Kong Quan, Ambassador of China to what is being referred to as “The Day of Cognac.”
By the way, did you know? We have a Chinese version of the blog
The event, organized by Price Waterhouse Cooper (PWC) and Credit Agricole, took place yesterday, January 22nd 2013. The heads of the four major Cognac houses were present, and so was Cognac Expert, with our Asia editor Peng (see Chinese version of Cognac-Expert.com).
The discussion with the Chinese Ambassador, Kong Quan, took place during a frank “round table” event on the topic of “France (Cognac) and China.”
The Day of Cognac began with an introduction by Jean-Pierre Vauzanges, CEO of Crédit Agricole Charente-Périgord. After that, three round tables were held about the topic of Cognac.
The first of these related to what is being referred to as the “Barometer Of Cognac,” and was led by Jean-Marc Olivier (former President of Courvoisier). Also present were Patrice Pinet (President of Courvoisier), Christophe Forget (President UGVC), Bruno Richardaud (Associate PWC) and Antoine Mornaud (Director of Crédit Agricole Specialized Clientele). They talked about the strategy of Courvoisier in Asia, the stocks of Cognac, provision for future markets and structuring operations etc.
The second round table, chaired by Vincent Nobileau (PWC Partner cognac), was about investment land. Participating in this discussion were Christophe Veral (head of the family Viticulture-BNIC), Jérôme Royer (Purchasing Director of Louis Royer ), Arnaud Agostini (Tax Law Lawyer-Partner Landzell Bordeaux) and Philippe Boujut (Chairman of Crédit Agricole).
This was a fascinating topic, mainly because of the incredible increase in value of a hectare of vines (an amazing 94 per cent between the years 1999 and 2000). And even though sales of Cognac have increased by 60 per cent, the price of a hectare of Cognac vineyard is still moderate compared to other prestigious areas (for example, it’s 25 times higher in the region of Champagne).
But the climax of the day was surely the participation Kong Quan, Chinese Ambassador, that occured during the third round table. Led by Jean-Marie Ordonneau, attended by Bernard PEILLON (Hennessy CEO), Jean-Marc Morel (Martell CEO) and Patrick Piana (CEO Rémy Martin). The subjects of “Exchanges between China and France” and “The Luxury Market in China” took place between the CEO and the ambassador. Kong Quan, speaks fluent French, and his sense of humour, expanded knowledge and repartee was well recevied and left a deep impression to all 800 spectators.
He spoke of the incredible rise of the popularity of Cognac, and his memories of visiting the region for the first time, some 15 years previously. Since then, the imports of Cognac to China have increased from 4 billion to 53 billion dollars. He also talked about the imminent arrival of a new government and the average economic growth of 10 per cent over 30 years. He also estimated that the middle class level of the Chinese population is likely to grow to over 500 million people – meaning many more potential customers for eaux-de-vie.
Not only this, but the country is also keen to protect the trademarks of Cognac, as well the planting rights – a very hot topic right now. 45,000 young Chinese currently come to France to study – a figure that is also shown by the percentage of Chinese studying at the University of Eaux-de-Vie in Segonzac, which currently stands at around 20 per cent.
All of this is backed by Remy Cointreau’s recently posted year-to-date sales (to end December 2012) that have risen by 17.5 per cent to 1.29 billion US dollars. Sales of Remy Martin in particular were up by 12.4 per cent, with high end Cognacs in the Asia region continuing to grow. And this doesn’t yet take into account the sales associated with the Chinese New Year, which falls at a later date this year, on February 10, that is a huge driver for the sale of Cognac.
Sources: www.just-drinks.com, www.reuters.com