South Australian wine export surge after Chinese tariffs axed in March

South Australian wine producers are spearheading a renewed flood of wine into China after punishing tariffs were removed, official figures reveal.

Trade Minister Don Farrell gives Chinese Commerce Minister Wang Wentao a bottle of his ‘Godfather Too’ Shiraz after their high-level talks in May, 2023.

More than $86m in wine has been exported to China by more than 350 businesses since crippling duties were abolished in March – almost all from South Australia.

More wine has been sold into China in the past four weeks than in the previous three years, Trade Minister Don Farrell revealed on Wednesday, when releasing official figures.

SA wine producers exported almost $80m of product to China in the first month since duties were removed on March 29 – 92.1 per cent of Australia’s total exports.

Senator Farrell told The Advertiser wine consumption had dropped in China because of Covid-19 lockdowns and lack of Australian wine availability.

“Now that it’s back, I think there’s a degree of pent-up demand. The surplus that was obviously affecting the industry very dramatically, while the impediments were on, will very quickly get absorbed by all this wine going into China,” he said.

“It’s top-quality wine. It’s some of our best wine that is now going into China for the Chinese consumers.”

Trade Minister Don Farrell, Minister attends a Joint Ministerial Economic Commission (JMEC) meeting at the Chinese Ministry of Commerce with Chinese Commerce Minister Wang Wentao.

Speaking ahead of Chinese Premier Li Qiang’s and Commerce Minister Wang Wentao’s weekend visit to Adelaide, Senator Farrell said $20bn worth of trade with China soon would be restored after the return of trade of commodities including wine, meat, coal, cotton, barley, timber and stone fruit.

Senator Farrell in May forecast the removal of remaining bans on lobster and some red meat. Up to 95 per cent of South Australia’s rock lobster exports were sent to China before the ban, which cruelled an industry that contributes more than 30 per cent of the state’s seafood gross product worth $158.5m.

Asked whether he expected the Chinese black-listing of lobster imports imposed in November, 2020, to be lifted during Premier Li’s Australian visit, Senator Farrell was noncommittal.

“We expect that all of the impediments with China will be removed in the very near future, we will have stabilised our relationship and then we can start building on the sorts of additional exports that we should be able to get into the Chinese market,” he said.

“People say the Chinese economy is struggling. The reality is there’s more than a billion people – a lot of consumers – and they just love clean, green Australian agricultural products and we should be there to support them.”

Agriculture Minister Murray Watt announced a $3.5m package to support the grape and wine industry’s long-term viability in response to an oversupply of red wine.

This will include a national register and database of grape plantings to help growers assess demand and supply.

Another measure will involve funding promotions, particularly in China, Japan and the United States, along with domestic promotion of inland wine regions, like the Riverland.

A year-long extension of a wine tourism and cellar door grant program designed to attract visitors to wine regions will enable producers to apply for grants of up to $100,000.