CHINA LAUNCHES ANTI-DUMPING INVESTIGATION ON IMPORTED AUSSIE WINES
By Siulan Law Mathews DipWSET
Credit: Siulan Law Mathews
China’s Ministry of Commerce announced today that it is launching an anti-dumping investigation on imported wines from Australia.
The ministry said in a statement that the anti-dumping probe is in response to a request from the China Alcoholic Drinks Association (CADA) raised in early July. The inquiry will look into potential dumping by Australian wine producers during 2019, and industry damages for the years from 2015 to 2019.
The statement said the investigation will target wines in containers holding 2 litres or less and will last for one year until 18 August 2021, with the potential of being extended until 18 February 2022 under special circumstances.
In its anti-dumping investigation request filed in July, the CADA said Australian wine producers had cut their prices and took market share from domestic wine producers.
It said between 2015 and 2019, the market share of domestic wine fell from 74.4% to 49.6%, while imports of Australian wines more than doubled to 12.08 million litres and import price fell 13% to USD6,723 per kilolitre.
Trading in shares of Treasury Wine Estates (TWE), Australia’s biggest wine producer and owner of Penfolds brand, was briefly halted pending an announcement, its share price fell as much as 20% in today’s trading.
In a statement, TWE said it "would cooperate with any requests for information from Chinese and Australian authorities."
"TWE has had a long and respectful relationship with China over many years through its team, partners, customers and consumers," the statement added.
Australia’s Federal Trade Minister Simon Birmingham said in a statement that Chinese authorities “have also advised Australia that they are considering a request to launch a countervailing duties investigation.”
“This is a very disappointing and perplexing development, Australian wine is not sold at below market prices and exports are not subsidised,” said Birmingham.
Australian Grape and Wine, the national wine-making industry association, said in a statement that: “We believe that the Australian grape and wine sector is well placed to respond to this investigation and Australian Grape & Wine and our exporting companies will cooperate fully.”
“The Australian industry welcomes the opportunity to build on these ties and work with the Chinese industry and government to further technical cooperation and develop lasting relationships,” the statement said.
Data from Wine Australia said the country exported about 62% of its wine productions, China is by far the biggest market by value worth AUD1.1billion (USD790 million).
China is also Australia’s top trade partner, the two countries were caught in trade tension in recent months over Australian Prime Minister Scott Morrison’s earlier call for an investigation on China on the origin of the coronavirus.
In May, China slapped a punitive 80% tariffs on barley imports from Australia, it then banned beef imports from four large Australian abattoirs citing improper food labelling.
In June, the Chinese government warned citizens about travelling and studying in Australia, saying that there is an increase in racist incidents against Asians amid COVID-19 pandemic.
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