A review of the measures that have decimated Australian wine sales to China has prompted an upbeat statement from Treasury Wine Estates.
The Penfolds brand owner, which had long hailed China as a major growth driver, saw its sales to the country wiped out in late 2020 when authorities imposed punitive tariffs on wine imports from Australia. The tariffs, introduced due to a combination of negative remarks from Australia’s government about China’s handling of COVID-19 as well as the alleged dumping of wine in the market, are now under review by China.
Welcoming the news, Treasury issued a statement to the Australian Stock Exchange today, claiming to be “well-placed to rebuild its business in China”.
“It’s great to see an agreement for an expedited pathway forward to allow our Australian brands and wine to be sold in the Chinese market,” said CEO Tim Ford. “Both governments have worked constructively to achieve this outcome and we now look forward to a new era of positive engagement that ultimately will build a strong and growing China wine category should the review see the removal of these tariffs.”
The review is expected to take “up to five months”, according to Treasury.
Despite accelerating its 'multi-country of origin' strategy for Penfolds - to include wine produced in China - since the tariff move, Treasury has struggled in recent years: Sales from the 12 months to the end of June were down 5% on the year prior, with fiscal 2023's AUD2.42bn way down on the AUD-2.83bn top-line performance in fiscal 2019.
