Many Australian wineries are reaping the benefits of China removing its import tariffs on Australian wine, with the latest wine export report showing three-year highs for Australia’s wine export volume and value.
In the 12 months up to the end of September 2024, Australian wine exports increased by 34 per cent in value to $2.39bn and by seven per cent in volume to 643 million litres, according to the latest Export Report from Wine Australia.
The value of shipments to mainland China increased by $604m to $612m, while volume increased by 58 million litres to 59 million litres.
While over 900 businesses have exported wine to mainland China over the last 12 months, Wine Australia said that the top 10 exporters by value and volume contributed 68 per cent and 38 per cent respectively to the overall totals.
Wine Australia Manager, Market Insights, Peter Bailey said: “While the export figures to mainland China are very positive, the impact on total export value is much larger than volume due to the premium price point of most wine entering the market. As such, this increase is unlikely to reduce the oversupply of red winegrapes in the warm inland regions.
“It’s important to note that shipments in these first six months are likely to be characteristic of re-stocking Australian wine after a long absence. Export levels are not equivalent to retail figures, and it will take time before it is evident how Chinese consumers are reacting to having Australian wine back in market.
“Despite this recent growth in exports, it is increasingly important to pursue market diversification and defend our share in other wine markets,”
Exports to all other destinations were stable in value at $1.78bn and declined in volume by three per cent to 585 million litres.
“The most significant decline in volume was in exports to the United States, with nearly all the loss in volume (21 million litres) being unpackaged wine, following a surge in unpackaged wine to the market throughout 2022 and the start of 2023. Exports to Canada stabilised in value as the decline in unpackaged wine eased and exports with an average value of $7.50 and above increased by 28 per cent in value,” Bailey said.
In Europe, growth in exports to the United Kingdom and Belgium more than offset declines to Germany, Denmark, and Spain – resulting in a small increase overall for the region.”
Bailey added: “Driving the results for markets, aside from mainland China, is the ongoing decline in global wine consumption as consumers moderate their alcohol consumption due to a more active focus on their health as well as cost-of-living pressures. Shipping delays and increased shipping costs due to regional conflicts are also making it harder for wine exporters to get their products into market.”
The top five destinations by value were:
- Mainland China (up $604m to $612m)
- UK (up $9m to $362m)
- US (down $25m to $341m)
- Hong Kong (up $65m to $270m), and
- Canada (down $0.08m to $147m).
The top five destinations by volume were:
- UK (up 7 million litres to 222 million litres)
- US (down 21 million litres to 113 million litres)
- Canada (down 6 million litres to 68 million litres)
- Mainland China (up 58 million litres to 59 million litres), and
- New Zealand (down 5 million litres to 26 million litres).
According to Trade Data Monitor, total wine exports of the world’s top 10 wine exporting countries dropped by three per cent in volume in the year ended June 2024, with Italy, Spain, France, South Africa, Germany, and New Zealand each reporting declines in wine exports.