China australian wine

Australian wines sold in China (pic: iStock)

With crushing tariffs on Australian wines and international travel restrictions due to the coronavirus pandemic, Australia is sobering up to a costly China fallout.

With crushing tariffs on Australian wines and international travel restrictions, Australia is sobering up to a costly China fallout.

Australia’s wine industry body, Wine Australia, has made the decision to cancel its annual China roadshow and pull out from the country’s biggest wine and spirits trade fair in March, as more Australian wineries see no return for investing in a market that’s now bent on stemming out Australian wines after slapping two rounds of punitive tariffs.

The decision was announced by the Australian government wine trade body today in its China newsletter. It also cited international travel restrictions as part of the reason for the withdrawal.

“The Australian wine sector has made a long-term commitment to building the market for Australian wine in China and fostered close ties with the Chinese wine trade and consumers,” says the trade org. “We are very disappointed to cancel this annual event but we hope you understand our decision.”

Wine Australia’s 2019 China roadshow (pic: Wine Australia)

However, as relations between China and Australia worsen, in a shocking move China slapped up to 218.5% anti-dumping and anti-subsidy tariffs on Australian wine in late November and early December, potentially upending Australia’s AU$1.2 billion wine exports to its biggest market.

It’s not immediately known the effects of the damaging tariffs but initial estimates by industry body Australian Grape and Wine says Australian wine exports to China plunged by 95%.

Wine Australia China roadshow is usually an important part of its marketing campaign in China. The 2020 edition was affected by the pandemic, and the cancellation this year signals that the blowback from tariffs has already discouraged Australian wineries for further engagement with the Chinese wine market under current political climate.

Furthermore, the wine industry body also withdrew from this year’s Chengdu Exhibitions in March 2021, including China Food & Drinks Fair (CFDF), arguably China’s most important wine and spirits show, as well as the hotel show – TWC Fine Wine Showcase.

Individual wineries wishing to participate the fair can still apply. Bulk wine suppliers are unaffected by the punitive tariff as it targets only wines in containers of 2 liters or below.

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