How Australian wines breached the Grape Wall of China
Chinese drinkers have gained a taste for fruity reds from down under, and as their middle class palates grow more discerning, exporters see room for growth
Chinese drinkers are showing an increasing thirst for Australian wines, making them the toast of exporters whose businesses are benefitting from the discerning palates of the country’s growing middle class and a multitude of buying options.
Australian wine exports to China grew 51 per cent in the 12 months up to September last year, making Australia the top exporter to China by value and second by volume, after France. China in turn is Australia’s top market, surpassing the United States last year.
Also fuelling the growth is a reduction in tariffs. From January 1, these fell to 5.6 per cent under the China-Australia Free Trade Agreement (ChAFTA). Prior to ChAFTA, they were 14 per cent.They will be zero by 2019.
The market for overseas wine in China took a hit in 2012 when the Communist Party banned extravagant gift-giving by officials in an effort to cut corruption. Australian wine exports to China hit a low in 2014, but that blip, which mainly affected the premium end of the market, has been corrected.