China's wine industry is undergoing deep contraction. In 2025, domestic wine output fell 17.1% to 97,000 kiloliters, while imports dropped 26.85%. The decline continued into early 2026. At the 7th Wine T7 Summit held in May 2026, seven leading producers (Changyu, COFCO, Moutai Wine, Dynasty, Dragon Seal, Xige, CITIC Nia) gathered to address the crisis under the theme "Light Drinking, Joy, and Restart."

Industry pressures include fewer social drinking occasions, generational shifts, and fierce competition from baijiu and beer. In addition, imported wines benefit from zero tariffs and China's OIV membership, intensifying the battle. Secretary-General Huo Xingsan noted a "mouthfeel equal rights movement" – blind tests with millions of views show that a 100-yuan wine can beat a 1,000-yuan wine. The future lies in understanding young consumers, not clinging to tradition.

Leading players are adapting: Changyu is launching four innovation categories; COFCO is breaking path dependency; Moutao Wine is de-gifting and going mass-market; Xige calls for ending the consumption hierarchy; Dynasty wants products "good-looking, tasty, fun"; CITIC Nia prioritizes survival with asset-light operations.

At the summit's core, Song Shuyu (President of China Alcoholic Drinks Association) posed five soul-searching questions:

1. What is our culture?

2. What is our terroir?

3. What is our flavor?

4. What is our consumption?

5. What is our value expression?

Song argued that China's wine industry has long followed a wrong path – "learning the world, making wine for the world, but selling in China." It adopted Western culture and standards while serving Chinese consumers. This mismatch has prevented the industry from answering the fundamental question: "For whom do we make wine?" The root of all problems is cultural.

The solution: integrate Chinese lifestyle and taste preferences, embed Chinese culture into terroir, develop flavor profiles suited to Chinese palates, build localized consumption scenes and rituals, and reconstruct value expression across quality, culture, and consumption. The ultimate shift: from "learn from the world, make wine for the world, market in China" to "learn from the world, make Chinese wine, walk the world."

Despite the downturn, Song urged confidence and patience. The true "restart" of China's wine industry begins with answering these five questions – not by telling others' stories, but by telling its own story of terroir and everyday life.