Canadian Ice Wine Exports
Asia Generates Half of Global Demand for Super-Sweet Canadian Wines
The world’s largest maker of ice wine, Canada produced 300,000 liters of the sweet dessert drink in 2006.
Spelled as one word “icewine” in Canada or called “Eiswein” in Germany, ice wine is made from frozen grapes that are hand-picked from the field and then processed at night when temperatures are never higher than -10°C. Pressed before thawing, the grapes produce a super-sweet liquid with a residual sugar level of at least 125 grams per liter. After fermenting in stainless steel vats, the resulting alcoholic drink is a rich, fruity dessert wine that is sold in bottles half the size of regular wine containers.
Canada’s Ice Wine Competitors
Only Germany, Austria and China have climates that resemble Canada’s cold seasons closely enough to be able to harvest ice wine. Due to the inconsistency of their cold seasons, Germany and Austria are not able to harvest ice wines every year.
According to Agriculture and Agri-Food Canada, a Chinese vintner named Changyu Winery produced more than 600,000 liters of ice wine in 2007 – doubling Canada’s ice wine production for 2006. Competitive exporting countries like Canada and Germany question the quality of China’s ice wine products, however.
Canada’s Top 10 Ice Wine Export Countries
Canada exported $11.7 million worth of ice wine in 2006. Among the leading countries that import Canadian ice wine, the United States continues to be both the biggest and fastest- growing market.
- United States … US $5 million (42.7% of total Canadian ice wine exports)
- South Korea … $2.1 million (17.9%)
- Japan … US $1 million (8.5%)
- Singapore … $884,000 (7.6%)
- Taiwan … $835,000 (7.1%)
- China … $600,000 (5.1%)
- Malaysia* … $225,000 (1.9%)
- Belgium* … $210,000 (1.8%)
- France* … $165,000 (1.4%)
- United Kingdom* … $150,000 (1.3%)
*estimated based on 2004/5 statistics from Agriculture and Agri-Food Canada
While Canada also exports ice wine to about 20 other countries, the top 10 countries above represent about 95% of Canadian ice wine exports. Frank Baldock’s Wine Express estimates that 80% of Canadian ice wine production is exported; however our calculations have that export percentage closer to 60%.
Asian Demand for Canadian Ice Wine
Six of the top 10 importers of Canadian ice wine are Asian countries. Generating a value of $5.6 million in 2006, Asian demand for Canadian ice wine represents about 48% of Canada’s worldwide exports of the super-sweet dessert wine. Because ice wine is extremely rare in Asia, visitors from the Far East often purchase ice wine as special gifts or investments to treasure back home.
These tourist purchases also serve as a wake-up call to Canadian ice wine producers and exporters, who may not be taking full advantage of Canada’s competitive advantage in exporting its high-quality, luxury product to fast-growing and increasingly wealthy groups of drinkers in Asia.
Ice Wine Challenges in China and Taiwan
The Ontario Wine Council reports that sales of Canadian ice wine in China have dropped 60% from around year 2000. While Chinese demand for super-sweet wines is robust, counterfeit ice wine is flooding the Chinese and Taiwanese markets with price tags of $15 per half-bottle, 3 to 10 times less than the price of genuine ice wine from Canada, Germany or Austria. Often the fake ice wine is made by adding water to juice concentrates and sugar or grapes frozen in the freezer. Bill Ross of the Canadian Vintners Association reveals that some so-called ice wines are non-wine beverages disguised with dyes.
Counterfeit ice wines at discount prices may be merely symptoms of a deeper international marketing problem. Specifically, affluent Chinese consumers buy ice wine as a status symbol, but do not understand what genuine ice wine tastes like much less how to savour a true ice wine experience.
Canadian Ice Wine Ingredients for Success
To effectvely market its competitive advantages globally, Canadian vintners need to initiate two strategic international trade measures.
- Canadian ice wine exporters must collaborate with China’s official state importers including the China National Cereals, Oils and Foodstuffs Import and Export Cooperation (CEROILS) to constrain the flow of beverages labeled as ice wines but that do not contain the required ingredients nor meet process quality controls.
- Canadian wine makers must effectively communicate, educate and thus market the unique ingredients, qualities, production processes and benefits of real Canadian ice wine to prospective clients around the globe.
Sources
This article presents unique insights and calculations based on statistics and data from Agriculture and Agri-Food Canada’s The Global Mead Market Comparison to the Success of Canadian Icewine Abroad (June 2007) and from canadianvinters.com.
