Australian wine: Ripe for the picking

Australian wineries are proving popular with Chinese buyers keen to ensure their supply of wine.

Hand-Picking-Bunch-of-GrapesWINE PRODUCERS in every corner of the globe have set their sights on China’s vast and increasingly wine-friendly population, but nowhere more so than in Australia.

Australian wineries see themselves as particularly well placed to service the growing Chinese interest in wine; partly because Australia is an English-speaking country that’s geographically within easy reach of the Asian continent, and partly because their softer, rounder styles of wine seem to be suited to the Chinese palate.

However, it’s been well publicised that Australian wineries have been through some challenging times in recent years. With tough market conditions, excess production and falling grape prices, numerous small businesses have been hitting the wall. In many ways, it’s an investor’s dream.

Some Australian wineries have launched an attack, opening export offices and even cellar doors in major Chinese cities. However in recent months the tide has been turning, and the Chinese have been travelling to Australia to ensure their supply of wine in the best possible way: buying wineries.

At any given time, it’s difficult to pinpoint the precise number of Australian wineries that are in negotiations to sell to a Chinese buyer.

In some cases it’s simply that some level of financial backing has been taken on board, but rumours of takeover bids and potential new ownership swirl around companies large and small in every wine region in the country. Many of the buyers approaching Australia already control routes to market in their homeland.

If you’re managing the distribution at the sales end, supplying that demand from your own winery at the production end is a logical step. As an additional motivation, the Chinese Central Government is now actively encouraging overseas investment by privately owned Chinese enterprises through the offer of guidance, policy support and, importantly, tax credits.

Sunshine Creek Vineyard in Victoria’s Yarra Valley claims to have been the first Chinese- national owned vineyard in Victoria, purchased by Mr Zhou Yun Jie in 2008. Zhou and his team created the Sunshine Creek name but say they trade off the Yarra Valley’s winegrowing history and reputation to promote their wines. Production is exported to China where it is sold through the brand’s stores in Beijing.

Similar stories now seem to be cropping up on almost a weekly basis, all over the country. “The phone calls went from, ‘We want to buy your wine,’ to, ‘We want to buy your winery.’ It’s certainly ramped up in the last couple of years,” says Matthew McCulloch, general manager of Chateau Tanunda.

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