How China's Taste in Wine Has Changed

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July 4 (Bloomberg) -- Doug Rumsam, managing director at Bordeaux Index Hong Kong Ltd., discusses China's growing and changing taste for wine with Angie Lau on "First Up." (Source: Bloomberg)

Headed for fine wine merchant and trader bordeaux index and joining us live in the studio this morning in hong kong.

Good to see you.

And you take a look at his story about wine consumption in china, it looks like they are doing a lot of effort to educate rather than being guaranteed fast and quick sales.

Has the environment changed?

Has the wine culture changed in china?

For sure you pick up on the education which is a key part of the progress of the market.

But we saw initially in 2008- 2011 was an enormous rush, incredible demand, but without a real infrastructure in place.

Subsequently and importantly, we have seen schools go in there and really lay the foundation of education for the chinese wine drinking public.

I think the story is exactly correct and that education is key to the progress of the public.

It has not been that great when it comes to fine wine sales.

Why not?

Too much too quickley, they, the 2008 and 2010 rush.

Too much overstocking at highs.

The government stepped in with no lavish spending cracking down on gifting with an enormous effect.

What we see now is the emergence of a real market.

Consumption is beginning to be the story instead of ranting and gifting.

You have a very interesting perspective here.

You are talking about wigle consumption versus storage ratio.

Explain what this is in business terms in the real world.

To break that down, we are looking at the investment and storage versus consumption.

As china really started to ratchet up their buying in 2008 and 2009, some of that filtered through particularly in the u.k. and there is a real drive on investment.

The wines were never drunk.

The wine would stay there and it was a paper trail.

What we see now is with prices down roughly 30% and in some cases 40%, some of the historic byes in the old market, europe and the u.s., are now starting to be interested again.

This is a consumption-lead story.

Talk about chinese taste when it comes to wine.

They love everything french, the bordeaux index, i'm sure you saw a lot of asian and chinese investors and wine lovers flocking to buy up to the bordeaux.

As that shifted to other regions in the world as the education heightens?

-- has that shifted?

I think bordeaux will always be the strengths.

The history behind the brand, the work and the promotion they do their and, importantly, the volume means that there probably there to stay but i think it is fair to say that china reflects hong kong tastes.

As hong kong went burgundy crazy, so china goes.

We are starting to see rarity.

Scarcity is really something they are looking for in the moment.

Burgundy, if you like the new play.

Exclusivity means expensive which is always good for fine wine merchants.

The latest study from the international wine and spirit research shows there is a projected 30% growth from 2012 to 2017 of chinese wine consumption.

Do you think that the spike the anticorruption drive in the slowdown that is still on track to meet that goal?

I think we need to look at china almost in two terms.

I don't think we will ever see that bull run we had 2000 date -- 2008-2011. i do think there will be growth.

I'm bullish on china as a market especially long-term.

They need to have the infrastructure, the education in place.

Yes, i think we will see growth.

I don't think it will be has concentrated on the really top

This text has been automatically generated. It may not be 100% accurate.

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