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Australia’s most valuable wine market: China

Australia’s most valuable wine market: China

Reports show that Australia’s wine export shows total exports to Greater China hit $853 million in value, which bests United States export value of $461 million. Total Australian wine exports also showed substantial growth across the board from the 12 months ending September 2017, with value growing 13 per cent to hit $2.44 billion and under 800 million litres in volume.

Wine Australia chief executive Andreas Clark said the rise of the Chinese market had been significant for the local industry. “The story in China has been quite remarkable as there is a real emerging wine culture which is still growing and has a long way to go in China.

Shiraz popular with consumers

Red wine varieties are preferred over white wine, accounting for 74 per cent of export value. Mr Clark said, “Red wine resonates strongly in the China market, and it is over 90 per cent of our exports”. “The success we have had is because we have really worked hard in the market. He also added “We’ve had seven years of negative value growth, so in the last three years we have been in growth territory which is quite promising.”

Winemakers excited for growth

Yalumba managing director Nick Waterman, in South Australia’s Barossa Valley, said the sustainable growth of exports had proven surprising. “I think there was some expectation by members of the wine industry, but I think most people would not have predicted such exponential growth,” he said. “It is a transitioning from a healthy option to more of a lifestyle option as well.

“As the country’s population becomes wealthier, we are seeing it move away from the five-star hotels into the general restaurant trade.” He also added “I envisage within the foreseeable future it will become the largest market for us by value”.

Does this valuable market have entry restrictions?

Exporting wine to China is very complex and time-consuming since China has very strict regulation on importing foreign wine. For businesses that want to export wine to China, understanding the whole process and documentation requirement is crucial.

LABELING REQUIREMENTS

All imported food is subject to inspection and must receive a clearance certificate by the Customs authority. The following information must be present on the label, in Chinese. Labels are required to be accurate, truthful, and non-misleading. Please note that the label must meet these requirements prior to importation. The Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) and its components are:

  • Name/brand of product
  • Ingredients list(Sweeteners, preservatives and added colour – legal in the case of fortified wine only – must be declared) Exempt for products made of one ingredient.
  • Net volume (ml): This should be marked as ‘net content xxx Ml (ml)’ for bottle sizes under a litre, or ‘net content x Litres (l)’ for bottle sizes over a litre. For packages up to (and including 200ml) the minimum print height is 3mm. From 200ml up to and including 1 litre, the minimum print height is 4mm. For packages greater than 1 litre the minimum print height is 6mm.
  • Alcohol content (%): The alcohol statement should be in the ‘Alcoholic strength xx.x% vol’ format.
  • Production date (yy/mm/dd): The date of bottling is required on Chinese labels.
  • Producer/Distributor/Importer (Name and address): The name and address of the Chinese agent, importer or distributor must be shown on the label. The name and address of the producer is not mandatory, however if included does not need to be translated into Chinese characters
  • Country of origin: A country of origin statement is mandatory. Importers will usually request a Certificate of Origin to confirm this claim.
  • Minimum durability date: Wines with an alcohol content of 10% or less are required to include a minimum durability date.
  • Product Type:(i.e. Grape Wine, ‘red’, ‘white’, ‘sparkling’, ‘semi-sparkling, ‘fortified’, ‘sweetened fortified’, etc.)
  • Sugar content (g/L)

 

 REQUIRED DOCUMENTS

  • Commercial invoice
  • Customs Value Declaration
  • Freight Insurance/documents
  • Packing List
  • Insurance Certificate
  • Certificate of Origin (for distilled spirits and malt beverages only)
  • Certificate of Health/Sanitation (for distilled spirits and malt beverages only)
  • Certificate of Authenticity/Free Sale (for distilled spirits and malt beverages only)
  • Consolidated Wine Export Certificate (for wine only)

The China-Australia Free Trade Agreement (ChAFTA) was signed on 17 June 2015 and came into effect December 20, 2015. Upon entry into force, ChAFTA will deliver substantial benefits for the Australian economy, building on this highly complementary relationship.

Local awareness of Australian premium wine has improved due to increasing bilateral business between China and Australia. Promotion and education of Australian wine products from the Australian wine industry will certainly help expand the market and increase market share. The Chinese demand for premium wine is evident with strong growth in the higher price segments. There is a move towards Westernisation and result in the development of a wine appreciation culture in China.