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This shift occurred when Australian wine sales to China fell sharply due to the continuing rift between the two countries.
go through Bloomberg
Published on October 19, 2021
When drinking Australian wines, the British began to choose higher-priced wines. This is important because sales to China have fallen sharply after Beijing’s trade retaliation.
According to a report by the Australian Wine Association, the United Kingdom was once regarded as the main market for cheap products, and has now surpassed China as the top destination for Australian high-end wines. In the year ended September 30, the country’s exports increased by 7% to 460 million Australian dollars (341 million U.S. dollars), although shipments fell by 2%.
Nevertheless, as the industry continues to face a series of headwinds, including global shipping delays, the total value of Australian wine exports fell by 24% to 2.3 billion Australian dollars.
As exports to mainland China plummeted by 77% to 274 million Australian dollars, the huge losses in the Chinese market continued to put pressure on the outlook after Beijing imposed prohibitive tariffs. After the relationship between the two countries has deteriorated sharply, the industry is still faltering after imposing more than 200% tariffs on Australian wine at the end of last year.
The move dealt a huge blow to the industry and eliminated the needs of the industry’s most valuable customers. This has caused many people to question the future of high-end brands, including Treasury Wine Estates Ltd., which previously accounted for about 30% of its total revenue from China.
The report shows that these tariffs are having a huge impact. During this period, the number of exporters shipping products to mainland China dropped sharply to 750 from 2,241 12 months ago.
According to the report, despite the tariffs imposed by mainland China, a large amount of goods continued to be shipped to buyers in Hong Kong, where wine exports soared by 135% to 207 million Australian dollars.
Australia’s wine exports to Hong Kong have soared after China’s tariffs hit
According to the report, the Australian wine company said its exporters are now focusing more on the UK to promote sales, and the market turmoil during the coronavirus pandemic and the Brexit transition period also helped boost demand for Australian products.
“Over the past 18 months, exports to the United Kingdom have increased significantly, which has led the market to consolidate its position as Australia’s number one destination,” said Rachel Trigger, general manager of corporate affairs and supervision of the Australian Wine Company. Rachel Triggs, said it.
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