Can’t sell enough for 860 swimming pools… Australian wine market “virtually collapsed”

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Social relations worsen due to the pandemic… China imposes punitive tariffs on Australian wine
Industry pessimistic: “Even if the trade dispute is resolved, it will be difficult to recover to previous levels”

Australian wine manufacturers are having a hard time as they have accumulated enough wine to fill 859 swimming pools the size of an Olympic Games.

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On the 26th (local time), the British Financial Times (FT) reported that after China, the world’s largest buyer of Australian wine, imposed punitive import tariffs on Australia as relations deteriorated due to the COVID-19 pandemic in 2020, about 2 billion liters of Australian wine was sold. It was reported citing an investment bank report that it was not selling.

In 2020, China imposed trade sanctions, including tariffs on Australian meat, coal, and wine, after then-Australian Prime Minister Scott Morrison called for an international investigation into where COVID-19 originated.

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Australian Prime Minister Anthony Albanage raised the issue of wine tariffs with Chinese Premier Li Qiang at the ASEAN meeting in Jakarta this month. “Exporting wine is beneficial to Australian wine producers as well as to China,” he said.

“The market has virtually collapsed, with wine unsold and sitting in warehouses,” said Alistair Pubrick, CEO of Australian wine manufacturer Tabilk. “The biggest market has disappeared due to China’s tariffs.”

Before tariffs were introduced, China was the largest market for Australian wine.

According to the Australian Grape and Wine Trading Company, the Chinese market, which was worth 1.2 billion Australian dollars (about 1.04 trillion won), has decreased to about 8 million Australian dollars (about 6.9 billion won) this year.

Industry officials predict that even if the trade dispute between Australia and China is resolved, it will be difficult for wine exports to recover to pre-2020 levels.

“It will take at least two years to resolve this issue,” said Tim Ford, CEO of Treasury Wine Estate, Australia’s largest wine producer. “It is time for cool-headed judgment.”

Meanwhile, in France, the world’s second-largest wine producer after Italy, the government has recently allocated a budget of about 200 million euros (about 286 billion won) to wine disposal costs due to a decrease in wine demand.

Source: Donga

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