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China's Cognac Crackdown

China's Cognac Crackdown

Warren Buffett Invests in Constellation Brands/ Wine Paris Sets Record/COFCO Embraces Instant Retail

Natalie Wang
February 24, 2025

China’s Liquor Crackdown Escalates Trade Tensions

China is shaking up the global spirits market with an alleged suspension of cognac in duty-free channels, impacting Martell, Hennessy, and Rémy Cointreau. At the same time, the country is raising tariffs on vermouth, brandy, and whisky, further tightening control over alcohol imports. These moves come amid rising trade frictions with Europe and could significantly impact foreign spirits brands operating in China.

Fraud, Market Shifts, and Changing Consumer Trends

Spanish authorities have dismantled a massive counterfeit wine operation smuggling 32,000 fake bottles of Rioja into China via Vietnam, underscoring the ongoing issue of wine fraud in the global market. Meanwhile, in South Korea, Millennials and Gen Z are driving a major shift in wine preferences, with Bourgogne white wines now outselling reds. Back in China, COFCO Wine & Wine is banking on the country’s booming instant retail sector, making fine wine as accessible as a late-night snack through rapid delivery services.

Big Investments and Industry Growth

Warren Buffett’s Berkshire Hathaway has made a bold move in the alcohol industry, investing US$1.24 billion in Constellation Brands, signaling confidence in the global drinks market. Meanwhile, Treasury Wine Estates is celebrating a 50.4% surge in Penfolds’ Asia revenue, fueled by its strong comeback in China. Across the industry, Wine Paris set a new record with 52,622 visitors from 150 countries, reaffirming the global wine trade’s resilience.

Industry Challenges: Climate, Production Declines, and Surging Demand

Bordeaux’s wine production has hit its lowest level since 1991 due to climate challenges, shifting global demand, and strategic oversupply adjustments. On the flip side, China’s instant retail boom has reshaped consumer buying habits, with Valentine’s Day wine sales soaring 66% as more consumers opt for last-minute digital purchases—a trend that could redefine how wine is sold in the future.

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Breaking: China Allegedly Suspended Cognac in Duty-Free Chanel

China’s largest duty-free operator has allegedly removed cognac products from top producers, including Martell, Hennessy, and Rémy Cointreau, in what appears to be an escalation of trade tensions between Beijing and Brussels.

China Raises Tariffs on Vermouth, Brandy, and Whisky

China is raising tariffs on several types of alcohol, including vermouth, brandy, and whisky, in a move that is expected to further strain the country’s sluggish liquor market.

Wine Paris Reports Record-Breaking Attendance

Wine Paris, the three-day trade fair, drew 52,622 visitors from 150 countries from Feb. 10-12, setting a new record for attendance.

Spain Dismantles Fake Wine Network Smuggling 32,000 ‘Riojas’ to China

Spanish police have dismantled a transnational criminal network that smuggled counterfeit Rioja wine to China via Vietnam, authorities said.

French Wine and Spirits Exports Slides Further in 2024 on Weaker China Demand

French wine and spirits exports fell for a second consecutive year in 2024, dragged down by weaker demand in China, according to a report released Tuesday by the Fédération des Exportateurs de Vins et Spiritueux de France (FEVS).

China’s COFCO Bets Big on Instant Retail

Imagine craving a bottle of Penfolds as much as your midnight snack—and getting it delivered just as fast. That’s the future COFCO Wine & Wine is betting on as it jumps headfirst into China’s booming instant retail scene.

Buffett’s Berkshire Hathaway Invests US$1.24 Billion in Constellation Brands

Warren Buffett’s Berkshire Hathaway invested US$1.24 billion in Constellation Brands in the fourth quarter of 2024, marking the first time the billionaire’s firm has taken a stake in the global alcohol company, according to a securities filing.

Love on Demand: China’s Instant Retail Boom Fuels 66% Surge in Valentine’s Day Wine Sales

This Valentine’s Day, Chinese consumers weren’t just swiping right—they were tapping “order now.” As romance went digital, wine became an unexpected star, with orders through instant retail platforms surging 66% in the week leading up to February 14.

Millennials and Gen Z Drive South Korea’s Bourgogne White Wine Boom

White wine has overtaken red as the top Bourgogne export to South Korea, driven by a younger generation reshaping the country’s wine consumption habits, according to the latest data from the Bourgogne Wine Board (BIVB).

Penfolds’ Revenue in Asia Surges 50.4%

Treasury Wine Estates (TWE) released its financial results for the first half of the 2025 fiscal year (July 1 – December 31, 2024), reporting strong revenue and profit growth driven by Penfolds’ return to the Chinese market and the robust performance of the DAOU brand in the U.S.

Bordeaux Wine Production Hits Lowest Level Since 1991

Bordeaux’s wine production fell to its lowest level in more than three decades in 2024, driven by climate challenges, declining global demand, and strategic supply cuts by winemakers.