Australian Wine Exports to China Surge Following Tariff Removal by Beijing

CANBERRA (Reuters) – Australian winemakers exported wine valued at A$86 million (approximately $57 million) to China in the month following Beijing’s decision to lift tariffs. Trade Minister Don Farrell expressed optimism about strong sales prospects moving forward.

In the year leading up to November 2020, Australia had exported wine worth $800 million to China before Beijing imposed a ban on imports, severely disrupting trade. The tariffs were lifted on March 29.

“I’m very optimistic that we can achieve a full recovery of the Australian wine market in China,” said Farrell. "All the evidence so far indicates that there is significant pent-up demand for Australian wine in the Chinese market," he noted while visiting a winery in South Australia.

Achieving a sustained recovery to 2020 levels would be remarkable, considering the steep decline in both wine imports and consumption in China in recent years. Such recovery would greatly benefit an Australian industry currently grappling with a major oversupply.

Farrell highlighted that nearly all wine shipped to China in April consisted of premium products, which have performed better compared to cheaper mass-market offerings. Additionally, the government announced an investment of A$3.5 million to support the wine industry, focusing on improved supply and demand data for producers, as well as marketing initiatives aimed at boosting sales in China, the United States, and Japan.

Agriculture Minister Murray Watt emphasized that the goal is to stimulate growth instead of providing compensation for farmers who transition from grape cultivation to other crops, as some nations have done.

The tariffs on wine were part of a larger set of trade restrictions enacted by China in response to Australia’s call for an investigation into the origins of COVID-19. While most of these measures have been lifted, restrictions on lobster imports still remain.

With Chinese Premier Li Qiang scheduled to visit Australia this weekend, Farrell expressed hope for the restoration of the lobster trade. “There is a willingness on our part and that of the Chinese government to eliminate all barriers between our countries,” he stated.

He added, “I am confident that this week’s visit will yield positive results for lobster producers.”