WINE AUSTRALIA TO CLOSE ITS CHINA OFFICE IN SHANGHAI
By Siulan Law Mathews DipWSET
Source: Wine Australia
Australia’s wine marketing board, Wine Australia, will close its China office in Shanghai due to the slump in wine exports to the country as a result of the punitive tariffs.
“Wine Australia has made the difficult decision to close our physical office in Shanghai. This decision follows extensive consultation with the Australian grape and wine sector and is based on the current environment and market opportunity,” American business channel CNBC quoted a Wine Australia spokeswoman as saying.
“Wine Australia will continue to maintain our brand presence in China via our wine trade and consumer facing social media channels, and will continue to work closely with in-market trade representatives on brand building and marketing campaigns,” added the spokeswoman.
Wine Australia said it will continue to operate in China, through “relationships with key in-market agency and marketing partners, trade show organisers and education networks,” a format that the organisation used for smaller export markets.
Australian Grape and Wine (AGW), the national association of wine producers, said the closure of the Shanghai office did not signal an end to an era.
“We understand and support Wine Australia’s decision, which is based on operational requirements,” AGW General Manager Lee McLean told CNBC.
“We also note that there is still strong demand for Australian wine in China and we hope Chinese consumers will have the opportunity to enjoy Australian wines again at some point in the future,” McLean added.
China used to be Australian wines’ biggest export market, the trade was worth AUD1.2 billion (USD830 million) before relations of the two countries strained over former Australian Prime Minister Scott Morrisons called for an investigation on China over the origin of the coronavirus.
Beijing announced anti-dumping and anti-subsidies investigations on imported Australian wines in August 2020.
A preliminary tariff of up to 212 percent was announced in November 2020. A final verdict was decided in March last year which said a tariff of up to 218 percent will be levied for a period of five years.
Australian wine exports to China slumped on the new tariffs, wine export value contracted 97 percent to just AUD24 million at the end of March this year, majority of the wines shipped were cheaper bulk wines which are not subject to the punitive tariffs.
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