How changing tastes in China are hitting Australia’s wine exports

Subdued Chinese demand was a key contributor to a decline in Australia’s wine exports last year, according to the Australian government agency that promotes the industry.

With consumer sentiment and evolving tastes reshaping the Chinese market, shipments to mainland China fell 17 per cent year on year to A$755 million (US$532.10 million) – the biggest single factor in an 8 per cent fall in Australia’s total wine exports last year – Wine Australia said in a report released on Wednesday.

The weak performance in China, which came despite the removal of tariffs of up to 218.4 per cent on Australian wine in March 2024, was in line with a long-term trend of declining consumption.

Those tariffs, imposed in response to Canberra’s call for an investigation into the origins of Covid-19, resulted in the importation of just 1 litre of Australian wine in January 2024.

“While the reopening of the mainland China market at the end of March 2024 provided some temporary relief in the decline in total exports, the Chinese wine market is one-third of the size it was five years ago – impacting both domestically produced and imported wines,” said Peter Bailey, Wine Australia’s manager of market insights.

He said weak consumer confidence was also continuing to weigh on household spending in China, with only “minor improvements” in sentiment seen since an all-time low in 2022 during the country’s coronavirus pandemic restrictions.

Australian wine exports last year dropped by 8 per cent in value to A$2.34 billion (US$1.65 billion) and 6 per cent in volume to 613 million litres (161.94 million gallons).

South China Morning Post