China is now Australia’s biggest wine exports market

The massive growth in China’s middle class has been a godsend for the Australian wine industry, with exports jumping 51% in the last year to $474 million, making it the top export market by value for the first time.

The rise of China is no more apparent than in the fact that just a decade ago, sales there were worth just $27 million.

Wine Australia’s Export Report, released today, reveal double digital growth for local exporters in the 12 months to 30 September 2016, up 10% to a total value of $2.17 billion.

Overseas fans are not only drinking more, they’re drinking better, with bottled exports up 14% to $1.8 billion and the average value increasing by 9% to $5.47 per litre, a 13-year high.

Only the UK disappointed, posting a small drop in sales, down 1% to $361 million.

Europe overall disappointed, down 3% to $570 million. Northeast Asia is now Australia’s number one export region, growing 35% – $177 million – to $678 million.

North America was up 3% to $639 million, while Southeast Asia grew 11% to $152 million.

The former top Australian wine drinking nation, the USA, saw sales rise 4% to $448 million.

Wine Australia CEO Andreas Clark said more than half of the total value of growth in the last 12 months was in wines priced at $10 or more per litre.

Growth in the premium price segments (detailed below) added more than $120 million in value.

“Of the 1743 active exporters across the period, 70% contributed to the value growth, an outstanding result. The value of exports grew in 81 of the 122 destinations for Australian wine,” Clark said.

Exports priced $10 and more per litre FOB (free on board, the value of the wine leaving Australia, excluding transport costs) were up in all top five markets ­– mainland China by 63%, the US by 21%, the United Kingdom by 20%, Canada by 9%, and Hong Kong by 7 per cent.

Clark said the China–Australia Free Trade Agreement also contributed to the stellar result in that market.

More than a third of Australian wine exports priced $10 and more per litre FOB were destined for China, valued at $190 million and up by 63%.

Negociants International executive director Adam O’Neill said demand premium wines in China showed no signs of abating, with online platforms such as Alibaba’s TMall helping Australian exporters find new customers.

Exports to Malaysia jumped 24% to $55 million, Taiwan was up 23% to $19 million and South Korea 42% to $14 million.

Japan posted a small decline of 0.3 per cent to $45 million, due to a decline in bulk wine exports.

Australia’s top five export markets by value

• Mainland China – $474 million ▲51%
• US – $448 million ▲4%
• UK – $361 million ▼3%
• Canada ­– $190 million ▲1%
• Hong Kong ­– $126 million ▲7%.

Source: https://www.businessinsider.com.au/china-is-now-australias-biggest-wine-exports-market-2016-10