Château Lafite Rothschild Owners Launch Chinese Wine Project

Bordeaux firm plans to plant on 60 acres in Shandong province and prove China's winemaking potential
Apr 3, 2009

The owners of Bordeaux's Château Lafite Rothschild will make wine in China, gaining a foothold in what many industry experts believe will be a crucial market in coming years. Domaines Baron de Rothschild (Lafite), partnering with a Chinese firm, has located 60 acres near Penglai on the Shandong peninsula. "We will be digging a lot of holes soon, mapping the soil," Christophe Salin, president of DBR, told Wine Spectator. He says actual wines will be several years away.

Bordeaux is one of the more popular wine categories in China, and Lafite has an outstanding reputation there. According to Salin, the project has been in the works since he began visiting China regularly 15 years ago. The company has long seen it as a valuable potential market, but waited until the demand for wine reached a certain level. "When we started selling in China, more than 20 years ago, you could find good wines where expatriates were—hotels, for example," he said. "But for three or four years now, the growth has been tremendous."

Salin says DBR hopes the Penglai project will show China that it too can produce a world-class wine, which will hopefully drive demand even further.

Another key hurdle was finding a local partner. Navigating China's notorious Communist bureaucracy can be tricky for Western companies. "If you want to secure 25 hectares [60 acres]," said Salin, "You need to negotiate with 70 to 80 farmers. You need a partner." After three years looking, DBR struck a deal with CITIC, a state-owned investment giant. CITIC will own 30 percent of the project.

Located roughly 300 miles southeast of Beijing, the peninsula is part of Shandong province and is one of the People's Republic's largest wine regions. Its proximity to the Bohai Sea and the Yellow Sea gives it a maritime climate, shielding it from the cold winters of northeastern China. Salin says DBR will test various red grape varieties to see what works best.

France Bordeaux News

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