Despite China’s quick economic recovery on the back of strong domestic consumption, its wine sector has yet to roar back its former glory.
However, the latest official data has shown that the wine market has buffered blowbacks from Australia’s exit and Delta variant disruptions, signaling the market is stabilizing.
According to the latest figures released by China Association for Imports and Exports of Wine and Spirits (CAWS), the country’s wine imports totalled US$818.7 million in the first six months of the year, a moderate drop of 1.55% year on year.
Its import volume declined slightly by 1.38% to 211.8 million liters, compared with the same period last year.
The decline is mainly dragged down by bottled wine imports, the majority of China’s overall wine imports. Bottled wine imports dropped 2.46% in value to US$765.9 million, while its volume also decreased by 7.54% to 149 million liters.
Sparkling wines however grew by a stunning 79.9% to US$50.8 million, and Bulk wine imports also rose by 13.87% to US$52.7 million in the Jan-June period.
Despite the overall drop, the set of data suggests that the market has largely absorbed impacts from Australia’s exit since the country previously contributed to roughly 40% of China’s overall wine imports.
China in March officially imposed up to 218% anti-dumping tariffs on Australian wines for a period of five years, as relations between the two countries sank to historic low over a range of disputes from covid origin to trade and politics.
With Australia’s waning presence in Chinese wine market, clear winners have also emerged to replace Aussie Shriaz and Cabernet.
Here are the top 10 wine exporters to China in the first half of the year. Scroll down the pages below to read detailed analysis and data.
No. 10 New Zealand
New Zealand’s bottled wine exports to China amounted to US$10.37 million in the first six months of the year. In volume terms, it’s the equivalent of 995,644 liters.
This represents an increase of 29.84% in value and 9.78% in volume compared with the same period last year.
Compared with its neighbour Australia, New Zealand enjoys warmer relationship with China, which remains the island country’s biggest trading partner.
The two countries’ trading relations deepened during the pandemic, with China accounting for about one third of New Zealand’s total exports.
No. 9 Germany
Germany exported 2.05 million liters of wines worth about US$12.25 million to China from January to June this year.
Though German wines’ market share in China remains small at only 1.5%, its rise this year is notable. Its export value during the period climbed 52.42% and its volume expanded 30.68%, suggesting more consumers are warming up its German wines led by Rieslings.
No. 8 South Africa
South Africa saw the sharpest growth in China in the first six months of the year, largely due to stockpiling of South African wines for fear of another alcohol ban.
The country exported 5.88 million liters of wines to China from January to June, up by 192.8% in volume compared with the same period last year.
Its export value also climbed by 95.33% to US$14.7 million, as countries race to stock up on South African wines after it has repeatedly banned wine exports amid Covid-19.
So far, South Africa has introduced four alcohol bans since the start of Covid-19 and the most recent one was only lifted in July, with strict curfew still imposed on restaurants and retailers. This has greatly damaged domestic alcohol sales and export markets.
No. 7 Argentina
The south American country is China’s 7th biggest wine supplier. It exported 15.8 million liters of wines worth about US$16.6 million to China in the first six months of the year.
Its export value swelled 21.39% over the same period last year but its volume dropped by 11.24%. It’s worthy to note that its average export wine price is the lowest among all top 10 countries at US$1.05 per liter, cheaper than Chile or Spain.
Overall, Argentinean wines take up 2.04% of market share in China, far behind its neighbour Chile.
No. 6 USA
Ever since the China-US trade war, American wine exports to China never recovered due to close to 100% punitive tariffs.
However, it appears the impacts have been gradually absorbed in the market and American wines are slowing catching up. That being said, it will be hard for American wines to return to pre-trade war level, mainly hampered by the tariffs and the two countries’ strained relationship.
From January to June this year, China imported 3.69 million liters of wines, the equivalent of US$19.94 million, a jump of 83.14% in value compared with the same period last year.
The average export price of American wines arriving in China grew by 31% to US$5.4 per liter. Overall, American wines account for 2.44% of the market share.
No. 6 Australia
It came as no surprise that Australia has been dethroned as China’s biggest wine supplier after China imposed up to 218% anti-dumping tariff on Australian wines.
Since China announced a preliminary punitive tariff last November on Australian wine amid the two countries worsening trade and political relations, Australian wine exports to China, its most lucrative market, has been free falling.
In the first half of the year, China only imported 7.22 million liters of Australian wines, worth about US$49.7 million.
This is a significant decline of 84.33% in value and 86.61% drop in volume.
More devastatingly for Australian wine producers, Australia’s market share has shrunk from nearly 40% to 6.08% within months.
A comeback from Australian wine seems unlikely given the anti-dumping tariff will be in place for the next five years.
No. 4 Spain
Spain, the world’s third biggest wine producer, is China’s fourth biggest wine supplier.
The country’s wine shipment to China grew 44.06% in value and 40.61% in volume to US$71.9 million and 30.04 million, respectively, over the same period last year.
Its average export price remains relatively low at US$2.39 per liter.
Its overall market share in China stands at 8.79%.
No. 3 Italy
Italy has a lot to celebrate in China.
For the first six months of the year, its wine exports grew by 49.84% to US$83.97 million, making it China’s third largest wine supplier.
Its export volume also expanded 30.12% to 16.89 million liters, which means its market share in China for the first time has surpassed 10%.
Italy in recent months has ramped up its promotions for the mainland market, with roadshows, tastings events and wine fairs planned across the country in the absence of Australian competitors.
At the current growth rate, Italy has more opportunities to consolidate its growth and reap in larger market shares, if it plays its cards right.
No. 2 Chile
Chile is China’s second biggest wine supplier by value and biggest supplier by volume.
The South American country exported 64.24 million liters of wines in the first six months of the year to China, up by 43.38% compared with the same period last year.
About 32 million liters though are bulk wines.
In value terms, the country exported US$159.03 million worth of wines to the Chinese market, a year-on-year increase of 45.87%.
Its market share in China has expanded to close to 20% at 19.42%.
Known for its affordability, Chile has benefited greatly from Australia’s ordeal in China, taking up some of the market shares left by the Australians.
Both Chile and New Zealand enjoy zero import tariffs when exporting wines to China, thanks to Free Trade Agreement.
Chile’s average wine export price is US$2.48 per liter, while that for New Zealand is US$10.42 per liter.
No. 1 France
Australia’s loss is France’s gain.
After France has lost out to Australia in 2019 as China’s biggest wine exporter, it has regained its ground following China’s punitive anti-dumping tariff on Australian wines.
The country in the first half of the year exported 55.6 million liters of wine valued at US$343.3 million to China, representing a 57.01% increase in value and a 16.62% increase in volume over the same period last year.
The sharp increase has taken its market share in China to 41.93%, a more than 10% growth compared with 2019, thanks to Australia’s exit.
Together with Chile, Italy, the three countries now take up over 70% of China’s imported wine market share.