The city of Yantai in the Shandong province, which has been the sister state of Adelaide since 1986.

By Sonya Logan

The sentiment in China around Australian wine has not faded despite the near absence of products in the market since China implemented anti-dumping duties in March 2021, members of the South Australian wine industry were told on Wednesday (18 October).

At a briefing held in Adelaide, which was jointly hosted by South Australia’s Department for Trade and Investment, Showcase SA and the South Australian Wine Industry Association, Tim White, a director of SA’s Department of Trade and Investment, Inca Lee, chief executive of the South Australian Wine Industry Association, and Richard Dolan, joint managing director of Bec Hardy Wines, reported on their visit to China in September as part a delegation of 25 chief executives representing the state’s wine, agriculture, aquaculture, university, education, tourism and trade sectors. Led by Premier Peter Malinauskas, the delegation was the largest government and business delegation to have travelled from Australia to China since the outbreak of COVID-19.

With expectations high that China will soon drop its anti-dumping duties on Australian wine following the lifting of tariffs on the nation’s barley, oaten hay, coal, cotton, copper and timber exports earlier this year, the delegation provided the opportunity to gain insights into what’s happening on the ground in China.

As part of their visit, delegates from the wine industry met with representatives of COFCO and Bright Foods, two of the largest state-owned food and wine importing companies in China.

Inca Lee told the briefing it had been made clear during meetings that there remained a positive sentiment around Australian wine with Chinese consumers, with its ‘clean and green’ and premium products still sought-after. She said it was pleasing to hear that “the hiatus in our trading partnership hasn’t diminished that sentiment”.

Tim White presented recent research by drinks market analysis company IWSR which revealed that Australian wine ranked third as the most purchased wine by country of origin among Chinese wine consumers.

“That’s quite interesting given the stock levels of Australian wine in market have been relatively low,” White said. “But it’s also a good sign that all the work that was done over a long period of time by our wine sector in China is still holding us in good stead as a reliable supplier of high-quality product.”

Richard Dolan added that “if you’ve got a strong brand and strong value proposition, good brand integrity, good values and premium price point position” there would be a market for Australian producers in China if the duties on Australian wine were removed. But he cautioned the entry level segment of the market would be “a massively competitive area”.

Tim White stressed that although economic growth in China had slowed in recent times, it would continue to be one of the world’s largest wine markets. However, the market had changed during Australia’s absence. This included a drop in wine consumption every year since the peak in 2017, changing consumer habits similar to those experienced elsewhere in the world regarding health and wellbeing , and a decline in the on-premise market — where the majority of wine consumption in the country takes place — following China’s COVID-19 lockdowns. Chinese wine consumers had also replaced Australian products with those from other countries, including France, Chile, Italy, Spain and South Africa, as well as from China itself, and wouldn’t immediately switch back to Australian wine if it were to become available again.

Attendees at the briefing were cautioned against perceiving the potential return of the China market as “the one solution” to the Australian wine sector’s current challenges. Tim White advised companies to maintain diversified export markets.

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