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China's wine pirates taint prized Canadian vintage
globeandmail.com ^ | April 16, 2005 | GEOFFREY YORK

Posted on 04/17/2005 6:25:07 AM PDT by quantim

BEIJING -- The pirates of China are energetic, but their knowledge of Canadian geography is a little shaky.

On the wine shelf of a Beijing supermarket, a label on a slender bottle shows a bucolic seaside scene. "Whistler Estates," it proclaims confidently. "Canada ice wine."

Apparently unaware that Whistler is a West Coast ski resort, the supplier has added another label on the same bottle: "Niagara Fall Pensula" [sic]. And then on a smaller label: "Rocky Mountain ice wine."

The misspellings and geographical blunders might be laughable, but the damage inflicted on Canadian exports is deadly serious. Within a few short years, Chinese shops have been flooded with counterfeit Canadian ice wine products, nearly destroying the market for the genuine product. The cost to Canadian wineries in lost sales and ruined trademarks has been incalculable.

Four years ago, China was a promising market for Canadian ice wine. China's emerging new middle-class consumers were discovering wine products of all kinds, and they loved the story of the exotic Canadian ice wine with its unique frozen-harvesting method. In 2001, one Beijing-based importer was selling 50 to 100 bottles of Canadian ice wine every month, despite the high price of the product.

Today, the importer's sales of Canadian ice wine have fallen to less than one-fifth of their 2001 level, largely because the pirated ice wines have grabbed control of the market.

"This has become a real plague for our industry," said Roger Provost, chief marketing officer of Vincor International Inc., the biggest Canadian winery, which makes Inniskillin ice wine.

"It's a cancer that we're trying to stamp out. We've spent a lot of money developing our brand franchise for legitimate ice wine, and these fake ice wines are slowly but surely destroying our whole brand. It's polluting the whole category."

To ensure that their "Canadian ice wine" appears genuine, Chinese counterfeiters are selling the product at outrageously high prices -- often $40 to $80 (Canadian) a bottle. And consumers are buying the foul-tasting stuff in the belief that it is Canadian.

"At least when you buy a fake Rolex for $10 you know it's a fake," Mr. Provost said. "But with this fake ice wine, people think they are buying a legitimate ice wine. And then their first experience of it is a very unpleasant one. They get turned off by it. We're losing a lot of customers, and they are lost forever."

Bottles of "Whistler Estates" ice wine, for example, are selling in Beijing shops for 249 yuan (about $37) -- the equivalent of a week's wages for a Chinese factory worker.

The Globe and Mail took a bottle of "Whistler Estates" to the Beijing office of China's leading wine importer, Montrose Food and Wine, for a taste test.

The company's experts were unimpressed. "This is like bad-smelling cough syrup," said Nicole Chang, the chief operating officer.

The managing director, Carl Crook, took out his magnifying glass and studied the labels. "They've totally botched the Canadian maple leaf," he noted. "It looks more like a stinging nettle."

Despite its claims to be produced in Canada, "Whistler Estates" is actually produced by a company in Shenyang, China, that calls itself Wei Si Le (the Chinese translation of Whistler). When customers call the company, they are assured that the product is completely Canadian. Its managers boast that "two Canadian experts" are supervising the production process, although they acknowledge that "some Chinese water" is used in the process.

In an interview, a company official insisted that the Shenyang company is owned by Canadian investors and has its headquarters in Canada. Asked whether its headquarters is in the town of Whistler, she said: "Probably. I don't know the accurate address."

At a supermarket in Beijing, bottles of "Whistler ice wine" are accompanied by a shelf label identifying them as a "product of Canada." But when The Globe and Mail informed a clerk that the wine is produced in China, the clerk checked her computer and confirmed it had a domestic bar code.

"We will contact the supplier," she said. "How dare they cheat us!"

Bogus versions of Canadian ice wine have been found all over Asia, particularly in China and Taiwan. The pirates have copied the tall slender bottle that is unique to Canadian ice wine, but the product itself is often a homemade mixture of cheap wine with extra sugar.

Mr. Provost tasted some of the fake ice wine in Taiwan recently. "What was in those bottles was absolutely foul," he said.

In China, his company discovered that a Chinese copycat had precisely duplicated the entire packaging and label of Inniskillin ice wine, only replacing the word Inniskillin with the company's name. Lawyers for Vincor sent a legal letter to the company, warning it to desist or face a court action. The company agreed to halt the imitations.

"If we hadn't spotted them, they'd be having a free ride," Mr. Provost said. "It was a gross trademark infringement. God knows what was in those bottles."

With its economy booming, China's demand for wine has skyrocketed. Its imports of bottled wine soared to more than seven million litres last year from two million litres in 2000.

Chinese wine imports from Canada have increased, too, but at a much slower rate. About 76,000 litres of Canadian wine were exported to China last year, far fewer than the wine exports to China from rivals such as South Africa and Argentina.

"The market is booming, but the Canadians are missing the boat," said Mr. Crook of Montrose. "Canadian ice wine has gained this great stature in China, so the pirates flooded in. The predators are cashing in." His company's sales of Canadian ice wine have dropped sharply in recent years, he said. "We've suffered a lot. We've had a very hard time selling ice wine because of the flood of fake wine."

The fakes are also encouraging corruption and bribery in China, he said. Because the fake products are sold at such high prices, the counterfeiters can give as much as 50 per cent of the price as a kickback to the retailers.

Alan Marks, director of winery operations at Summerhill Pyramid Winery in Kelowna, B.C., travelled to China last year to study the problem of fake wine. "In six days of travel, we weren't even able to find one legitimate ice wine, except for one German one," he said.


TOPICS: Business/Economy
KEYWORDS: canada; china; economy; fraud; trade; wine
This chicom wine fraud is an increasing threat for any country producing quality wines. The fact they targeted a 'sweet' foreign dessert wine is not an accident when dealing with a populous with an uneducated wine palate ripe for exploitation.
1 posted on 04/17/2005 6:25:08 AM PDT by quantim
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To: NautiNurse; andrew2527; AnAmericanMother; A Jovial Cad; Betis70; Bigturbowski; blanknoone; ...
Click to be added!

Wine news ping.

2 posted on 04/17/2005 6:29:18 AM PDT by quantim (Victory is not relative, it is absolute.)
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To: quantim

The Chicoms? These are the same swines turning beer into urine.


3 posted on 04/17/2005 6:44:10 AM PDT by hflynn
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To: quantim

Ice wine is a famous dessert wine produced from grapes frozen solid on the vine and harvested at a maximum temperature of -10 degrees Celsius.

The grapes are then pressed under extreme pressure. The result is apricot and honey aromas with a fine overall balance between fresh fruit flavors, sweetness and high acidity. It pours gold color into the glass.

Ice wine is typically made of Vidal and Riesling grapes. Ice wine, properly created, must follow VQA (Vintners Quality Alliance) regulations to ensure the highest quality product. Key amongst these rules is ice wine must be naturally produced - no artificial freezing allowed. This makes ice wine very difficult to create - grapes must be guarded against too extreme temperatures, and because they are the last grapes on the vines, they must be defended vigorously against birds and other animals.

Ice wine grapes must be hand picked and grapes in this condition have a very low yield - often an entire vine only makes a single bottle of ice wine. After this long harvest process, the grapes go through weeks of fermentation, followed by a few months of barrel aging. Ice wine is expensive and often sold in half-bottles.


4 posted on 04/17/2005 7:35:47 AM PDT by sergeantdave (Beer is proof that God loves us and wants us to be happy. - Benjamin Franklin)
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To: quantim
I agree with you, except to note that I have a very educated palate and a 300 bottle wine cellar, and I LOVE Canadian ice wine. Of course I usually drink dry reds, but every once in a while an ice wine (or Sauternes or port) is just the right thing after dinner.

-ccm

5 posted on 04/17/2005 7:51:15 AM PDT by ccmay (Question Diversity)
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To: quantim

Will check labels carefully this afternoon at the Bordeaux-vs- ? wine tasting. Will report back later...


6 posted on 04/17/2005 7:52:02 AM PDT by NautiNurse ("I'd rather see someone go to work for a Republican campaign than sit on their butt."--Howard Dean)
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To: Willie Green

Freak Trade ping...


7 posted on 04/17/2005 7:53:45 AM PDT by null and void (RFID/0110 0110 0110 - It's all in the wristâ„¢...)
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To: sergeantdave

What, no mention of botrytis cinerea? ;-)


8 posted on 04/17/2005 8:37:37 AM PDT by quantim (Victory is not relative, it is absolute.)
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To: quantim

The Chinese counterfeit everything, why not wine.

Without legitimate laws and a government and populace that honor and follow the laws, society descends into chaos.


9 posted on 04/17/2005 9:03:11 AM PDT by garyhope
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To: quantim
I bet you can pick up a nice Chinese Champagne as well.

I don't know why anyone thinks the Chinese market is a viable one. By entering their market you are just inviting them to duplicate your product and run you out of their market. Eventually they will have an exact copy good enough to sell in all of your main markets under a different label at a price you can't touch (available at your local WalMart of course).

Lie with dogs, expect fleas.
10 posted on 04/17/2005 9:41:19 AM PDT by RockyMtnMan
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To: garyhope; King Prout; SandyInSeattle; Knitting A Conundrum; bad company; All
Yes laugh now. First it is Canada and then us.

Just wait till you see how the "Chinese Cheese Pirates" destroy Kraft Foods!

People such as myself will have no other option than to purchase Counterfeit Chicom Velveeta.

An American Expat in Southeast Asia

11 posted on 04/17/2005 9:48:12 AM PDT by expatguy (http://laotze.blogspot.com/)
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To: expatguy

the ChiComs are the biggest patent and intellectual-property pirates on the planet.

unless and until the rest of the world links expensive consequences to ChiCom flouting of patent law, they will laugh at us and continue to rob us blind.


12 posted on 04/17/2005 10:00:50 AM PDT by King Prout (blast and char it among fetid buzzard guts!)
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