Hope for Aussie wine exports as Trade Minister seeks “full resumption” of trade in Beijing

May 11, 2023
By Rachel White

Trade Minister Don Farrell today touches down in China, the first Australian trade minister to do so since 2019, on a mission to seek a “full resumption” of Australian exports to China, including wine, barely and seafood.

Meeting with his Chinese counterpart, Minister of Commerce Minister Wang Wentao, Senator Farrell said he expects progress in the resolution of the existing trade impediments as tensions between the two countries ease.

“My visit to Beijing builds on our constructive virtual meeting in February, and follows the Prime Minister’s meeting with President Xi Jinping in November 2022, and the Foreign Minister’s meetings with her counterparts in 2022 and March this year,” said Senator Farrell.

China is expected to relinquish some trade restrictions, allowing two-way trade to recommence in earnest, a valuable relationship worth $287 billion in 2022.

“During my visit I will be advocating strongly for the full resumption of unimpeded Australian exports to China – for all sectors – to the benefit of both countries and in the interests of Australian exporters and producers,” said Senator Farrell.

Lee McLean, CEO at Australian Grape & Wine, said news of the meeting is welcome to Australian wine producers, who have endured the toughest commercial environment seen in many decades.

“It is very welcome news to hear Minister Farrell is meeting his Chinese counterpart in China. This demonstrates the relationship is heading in the right direction.

“Dialogue of this kind is critical if we are to resolve the trade issues our grape growers and winemakers are dealing with,” said McLean.

Since trade came to a virtual holt in late 2020, import duties of up to 218 per cent were imposed on Australian bottled wines, effectively closing the market. And while the news of the meeting is encouraging, McLean warns that any trade resolution could take time.

“We are cautiously optimistic that this dialogue can lead to opportunities to resolve the trade tensions Australia’s wine sector is dealing with. If Australia and China successfully agree on a pathway to removing import duties in this context, this may provide a template for wine, but we believe this is likely to take time,” he said.

At its peak, Australian wine exports to China were about $1.2 billion annually, now accounting for around $12 million, a drop of about 99 per cent.

McLean said Australian wine exports are unlikely to reach a value of $1.2 billion per annum again as China’s wine market has evolved, economic conditions have changed, and Australian winemakers are working hard to diversify their income streams.

“There is still strong demand for Australian wine in China,” said McLean. “And we hope Chinese consumers can enjoy our products again soon.”

During his quick two-day visit, Senator Farrell will also chair the 16th Joint Ministerial Economic Commission along with Minister Wang and said he looks forward to meeting with other Chinese political leaders and Australian business representatives operating in China.

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