China wine tariffs hit Barossa and Clare Valley growers hard amid calls for drinkers to buy local

Leading Barossa and Clare Valley wineries are calling for locals to pick up a bottle of SA wine to help soften the blow of China’s export tariffs.

Barossa and Clare Valley wine industry leaders are calling for Australians to drink local in the face of unprecedented tariffs on Australian wine in China.

China announced duties on Australian wines of up to 212 per cent last Friday, effectively crippling exports to the economic superpower and prompting concerns that the flow on effect would impact jobs in the region.

South Australian Wine Industry Association president and Yalumba wines managing director Nick Waterman said a groundswell of local support could counteract the impact of the tariffs.

He also hoped government agencies would encourage people to back regions like the Barossa Valley.

“I've seen some analysis that suggests that if we increase consumption, by seven per cent then we would deal with the bulk of the fallout from China’s tariffs,” Mr Waterman.

Nick Waterman President of South Australian Wine Industry Association discusses impact of Chinese wine tariffs, pictured at Yalumba Cellar Door.

Mr Waterman also said despite SA being a big wine producer nationally, Australians still drink a large amount of imported products.

“People drink Italian, French and New Zealand wine and there is the opportunity that even if the market isn't growing by seven per cent, maybe there will at least be a shift to replace that imported consumption.”

South Australian wine makes up $700 million of the nation’s $1.3 billion dollar export industry to China, but already major groups have been flagging cancelled shipments in the face of the new duties.

Taylor Wines managing director Mitchell Taylor echoed Mr Waterman’s comments.

The Clare Valley winery has been exporting to China for over three decades but Mr Taylor said stock had to be redirected to Singapore.

“We currently have two containers that are currently going through customs, but the Chinese officials have been requesting samples from those containers,” Mr Taylor said.

“We have another four containers on the way to China on a ship but in light of the 212 per cent duty, we are now taking those four containers off the ship in Singapore.”

Another major Barossa winery, Seppeltsfield, has been impacted by the duties on the ground in China.

Seppeltsfield managing director Steven Trigg. Picture: Tom Huntley

Managing director Steven Trigg said a key concern was the lack of certainty around the issue.

“Only last Friday we learned of the measures for the first time,” Mr Trigg said.

“I think the generalisation in the industry is that those $20-30 bottles of wine are out of the game.

“It’s only going to be the top maybe five per cent of wines that go to the country that are in the game at all.”

After being shut out of the Chinese market, growers have also begun to look at other markets to soften the financial blow.

China’s current interim tariffs last until March 2021, however industry leaders have expressed fears the Chinese market could effectively be closed to Australian wine for up to five years.