CANBERRA (Reuters) – The lifting of trade tariffs by China triggered a surge in Australian wine exports last year, but it is unclear whether Chinese demand will remain strong after buyers have restocked, an industry body said on Wednesday.
Meanwhile, exports to the rest of the world continued to decline as high inflation and worries about the health impacts of alcohol reduced global wine consumption, industry body Wine Australia said.
Australia is one of the world’s biggest shippers of wine. Its industry was hammered when China, its most valuable export market, used tariffs to block imports of bottled wine in 2020.
The Chinese embargo worsened problems of massive oversupply and low grape prices that have caused farmers to pull up millions of vines. Major producers such as Treasury Wines and Pernod Ricard last year announced sales of assets in Australia.
Beijing lifted its tariffs on March 29 last year after a warming of political relations with Canberra.
Between then and year-end, Australia shipped 83 million litres of wine worth A$902 million ($562 million) to mainland China, Wine Australia said, a monthly pace of exports similar to that before the tariffs.
The surge in shipments to China – which buys much more expensive bottles than Australia’s other main markets, the United States and Britain – was positive but continued growth is not assured, said Wine Australia research manager Peter Bailey.
“Chinese wine consumption is much lower than it was before the import tariffs were imposed,” he said. “It will take more time before it becomes clear what the ‘new normal’ level of exports to mainland China will be after this initial re-stocking period.”
Shipments to the rest of the world meanwhile declined by 13% in value to A$1.64 billion and 7% in volume to 565 million litres during 2024.
Global wine consumption fell in 2023 to its lowest level since 1996, according to the International Organisation for Vine and Wine (OIV). Consumption in China is falling much faster than in many other countries.
($1 = 1.6038 Australian dollars)
(Reporting by Peter Hobson; Editing by Saad Sayeed)
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