Famous Barossa Valley wine finds success in new Asian markets in the face of China trade tensions
South Australia’s premium wine region may have been shut-out of China but these innovative labels have found new customers to enjoy their famous drops.
Barossa, Clare & Gawler
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Almost a year after South Australia’s famed wine was locked out of profitable Chinese markets, the Barossa is fighting back and thriving.
Local wine labels pivoted when Australia-China trade war threatened to decimate the industry and now their drops are growing in popularity and price in other Asian countries.
China essentially shut-out Australian wine by introducing duties ranging from 107 per cent to 212 per cent.
The tariffs officially went into effect in May of 2021 and are expected to last a minimum of five years.
The move forced Barossa winemakers to explore alternative markets and they have found success in Singapore and South Korea, with some even using secondary countries to export their product to the Chinese mainland.
Treasury Wine Estate, which includes brands like Penfolds, pivoted to other markets across Asia, in addition to the American continents.
Barossa Wine & Grape Association chief executive James March said despite the closure of the Chinese market, Barossa wines were continuing to thrive.
“They (the new markets) are providing excellent growth opportunities and, to date, is reporting a 79 per cent increase in export value and 18.4 per cent in volume of bottled wine to this region over the previous year,” Mr March said.
“At the same time, markets such as South Korea have experienced a 104 per cent increase in volume and a 134 per cent increase in value.
“Barossa’s average price per litre is continuing to grow (excluding China) and is two and a half times higher when compared to Australia’s average price per litre.”
The Barossa Wine School has formed educator partnerships in Japan, South Korea, the UAE and Singapore, which Mr March said would remain essential in marketing the Barossa brand.
An Austrade spokesperson said the Australian Government’s $72.7 million Agribusiness Expansion Initiative was supporting winemakers to expand international markets.
The spokesperson also said the free trade agreement with the United Kingdom would save $43 million in customs duties annually.
While wine exports to mainland China were down by 45 per cent in value, the spokesperson said the value of wine exports to other markets increased 12 per cent over the 12 months to June 2021, resulting in $1.96 billion.
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