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Wednesday 17 November 2021

Australia wine woes in China provide a lift for South Africa

So Australia remains at trade loggerheads with China. 

Wine tariffs have demolished Australian wine exports. 

But the dispute is proving brilliant news for South African winemakers. 
China’s tariffs on Australian wine have South African exporters raising a glass to their new Chinese buyers as Chinese drinkers try bottles from an unfamiliar destination. 

Whether it is in the wine sections of China’s Walmarts or Carrefours, in the exclusive wine dealerships of China’s first-tier cities, or on the wine pages of e-commerce giants Jingdong and Tmall, South African winemakers have never had it so good, Business Day reported. 

And the Chileans are also pretty happy. 

Recent figures from umbrella body Wines of South Africa show Cape wines gaining ground in the Chinese market after tariffs of up to 212% were imposed on Australian wines. 

Sales were up 18.3% year-on-year in quarter one of 2021 GDP growth. 

Australia’s Chinese market share fell from more than 40% in 2020 to 5% in 2021. France benefitted, along with Chile, Italy and Spain. 

Growth has been concentrated in sales volume, with South Africa's total wine sales volume to China growing by nearly 4-million units from 8-million to 11.8-million between 2019 and 2021. 

The Chinese have an apparently insatiable appetite for quality red wine. Having lost so much market share the question now is how Australian exporters will regain their foothold if and when trade relations are normalised?   

Image: Stellenbosch vineyards in South Africa 

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