Wine Australia has announced it will no longer have a physical presence in China. The wine authority has made the decision to close its office in Shanghai following the introduction of prohibitive tariffs, which have reduced opportunities for the Australian wine industry in the Chinese market.
In 2020 Australian winemakers were targeted by Beijing officials, who imposed import duties of more than 200% on them. China was previously Australia’s leading export market, with sales worth $1.2 billion in the year to September 2020. Following the decision, exports to mainland China plummeted by 97%.
“This decision follows extensive consultation with the Australian grape and wine industry and is based on the current environment and market opportunities,” a Wine Australia spokesperson said.
“Wine Australia will continue to maintain our brand presence in China via our wine trade and consumer facing social media channels, and will continue to work closely with in-market trade representatives on brand building and marketing campaigns.”
The country’s total wine exports decreased by 30% in value to $2.03 billion in the year to December 31, 2021.
Wine Australia General Manager Corporate Affairs and Regulation Rachel Triggs recently warned that “we’ll keep seeing significant differences in the year-to-date export figures as a result of the deposit tariffs until the end of 2022”.
Hong Kong is not included in the tariffs, and exports to the city increased 45% last year. Exports are up by 108% to Singapore, 74% to South Korea, 65% to Taiwan and 31% to Thailand.
Wine Australia also welcomed the announcement in April that tariffs on Australian wine exports to India will be slashed following the signing of the Australia–India Economic Cooperation and Trade Agreement (AI ECTA).
“There is potential for growth in the sale and consumption of Australian wine in India with Australia already having the greatest share of the imported wine market,” Triggs said. “In particular, the AI ECTA will make India a more viable proposition for small to medium winemakers who have not previously contemplated entering into that market.
“The wine culture in India is maturing as consumers discover and learn more about wine. It’s exciting to contemplate Australian winemakers playing a role in that maturation, and the AI ECTA will make it easier for them to do so.”