DAN'S WINE BLOG- TELL 'EM THEY ARE DREAMING
Dan Traucki MWCC
WINE ASSIST P/L Freelance Wine Journalist. Also facilitating the export of Australian Wines to the world.
Friday, January 20, 2023
Happy New Year and may 2023 be a grand year for you despite the floods, politics, fake news and all the loonies trying to run the world.
Talking of fake news, let’s start off with China – last month I came across this headline in an online posting from South China Morning Post (SCMP) (see link below) “Australia’s wine, lobster exporters see no ‘clear reason’ to let China go, despite prolonged trade spat” with the headline coming from this statement: “There’s not a clear reason to let go of a big customer like China, from the business perspective” said Simon Wu, president of the Australia-China Friendship Society of Western Australia.
Most of the article related to the lobster exporters, however in relation to wine, they offered the following statement: “The most realistic scenario (NO, it is wishful thinking/dreaming) that might come out of the talk between Albanese and Xi would be a reduction of tariffs, while the most ideal scenario is lifting the tariffs totally before 2026 after top-level leaders have communicated,” said an Australian wine exporter surnamed Zhang, who asked not to be fully identified due to the sensitivity of the issue. "Some will still import wine into mainland China through Hong Kong, as certain smaller ports in the north of China don’t strictly follow the procedure of customs clearance,” he added.
This is fake, not responsible news, more like propaganda than news and also espouses law breaking – smuggling!
To put the picture into context we have gone from sales of $2.2billion a year to $25million a year. That in itself is clear reason to walk away from China rather than hang on misty-eyed in vain hope.
However, even IF Xi Jinping were to bring tariffs back down “before 2026” there are a number of other factors that make China a much, much, less attractive market than before.
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Apart from the fact that our sales have been in part replaced by other countries, the biggest thing is that despite all the hype, wine sales in China are falling as shown in the graph below. This graph shows that wine consumption in China has fallen by nearly 50% in the five years between 2016 and 2021.
The sales in 2021 were back down to the level of 1999 (before the massive expansion of Australian wine sales to China) – who other than Taylors Wines was selling wine to China in 1999? To put it into context, in 2003 I sold five containers of Riverland Cabernet to China and that constituted 0.5% of Australia’s TOTAL red wines sales to China for that year. In 2021, until the iniquitous tax was introduced, that sales volume would not even account for one day’s worth of sales to China.
No, the election wasn’t stolen, Putin is a terrorist, China won’t be coming back anytime soon and even if they did it would be a considerably smaller and tougher market. So, instead of sitting there doe-eyed, quietly praying with fingers crossed, we need to get off our arses and find other viable and hopefully long-term, markets for our wines.
How about looking at Korea, Japan, Vietnam, Malaysia, Indonesia, Brazil, Poland and even some of the more stable and prosperous African countries. Come on Wine Australia! How about a wine event in Nigeria, Brazil, Poland or Indonesia?
The world is a thirsty place and getting thirstier with global warming. It is our duty to ensure as many people as possible around the world can readily enjoy Australian wine.
Well, that’s my soap box rant to start the New Year! Have an excellent vintage and may 2023 be better for you than the last couple of years. Cheers, Dan T.