Drop in Western Australian exports to China

27th August, 2014 by Simon Howland

The Western Australian wine industry is being forced to reassess the extent of its reliance on China after seeing a sharp fall in sales and volume.

wine australiaAccording to the ABC, new export figures reveal wine exports from WA to China in the 12 months to July 2014 were down 25% by volume and 20% in sales.

The national wine industry body, Wine Australia, said the value of the states exports to china fell from $AUD41.6 million (£23.4m) to $AUD33.4m (£18.8m).

Most alarmingly the drops have occurred despite a considerable focus on the growing Chinese market following exponential growth from the early to mid 2000’s until 2013 during which time China became WA’s single biggest export market.

WA Wine Industry Association chief executive Larry Jorgensen said shifts in Chinese domestic policy are a key factor: “We think it’s happening because of the austerity measures everyone has heard about that the Chinese government has implemented because of a bit of ostentatious behaviour in gift-giving on the part of government officials,”

“That’s had an effect to some extent and there’s a possibility as well, I suppose, that other countries have taken some of the market share we were dealing in previously.

“I think people are re-assessing how much they put focus onto China and are starting to consider other markets.”

The slump comes on the back of a difficult period for Western Australian producers as global economic struggles and an unfavourable exchange rate have been compounded by difficulties relating to domestic sales.

“It probably is as tough as it’s ever been for the wine industry, the perfect storm that we speak of – the dollar, the diminishing markets, those sorts of things have certainly come together,” said Jorgensen.

“Probably given where we trade in the market, at the premium end, in tough times people assess what they’re spending their money on so we may have felt it perhaps a little bit more.”

Murray McHenry remains confident growth in China is still viable.

Murray McHenry remains confident growth in China is still viable.

But the difficulties in China have not been uniform across WA and Margaret River producer Murray McHenry of McHenry Hohnen said he’s managed to keep his sales to China growing: “Australian wineries, particularly boutique ones in Margaret River, have had to look offshore for quality markets and China, for us, is proving to be that.”

McHenry blamed the quality of some of the wines sent to China during the initial growth period: “They were sending up wines under labels that no-one in Australia has ever heard of and they were just emptying their tanks of what was known as the ‘wine glut’ in Australia.”

“Australia’s reputation was tarnished by these really bad wines that were sent there.”

Margaret River Wine Association president Nigel Gallop is confident the dip can be rectified: “I think (the drop in exports) is an adjustment and I think we can grow again from here, as long as we get that message strongly out there that Margaret River is growing great, world-class wines.”

“The more we get that message out there to China and the rest of the world, the better this industry is going to be.”

Jorgensen said it was “inevitable” that sales to China will rebound.

One Response to “Drop in Western Australian exports to China”

  1. Alan Henley says:

    My website is dedicated to Western Australian wines sold in the U.k.Of late we have experienced a decline in sales partly due to the world slow down,strrong AUS dollar we look with interest to the future drends

Leave a Reply

Your email address will not be published. Required fields are marked *

Subscribe to our newsletters

Job vacancies

Sales Support Assistant

H2Vin Ltd
London, UK

Sales Administrator

Les Caves de Pyrène
Guildford, Surrey

Sales Order Processor

Amathus Drinks
Park Royal, London NW10, UK

Sales Executive (London – Craft Spirits)

Bimber Distillery
London, UK

Events & PR Co-ordinator

Alliance Wine
London, UK

Partner Development Manager - That Boutique-y Gin Company

That Boutique-y Gin Company
Field Based, UK

Head of Merchant Sales

Grapevine the Wineservice Company
Cumbria, UK

Business Development Manager – Central London

Marussia Beverages UK Ltd
Field based – London, UK

Account Manager – Premium Restaurants, London

Kingfisher Beer Europe Ltd
London (Central), UK

Field Sales Representative - Beer Innovation

Elastic
Various locations, UK

Events Executive

The Drinks Business
London, UK

Area Sales Executive

Gordon & Macphail
Southern England (excluding London) and Inner London, UK

Buyer – Wine & Spirits

Sipp
London, UK

Spirits Advisor

The Whisky Exchange
London, UK

The Global Malbec Masters 2017

Deadline : 1st August 2017

The Global Beer Masters 2017

Deadline : 1st August 2017

Global Chardonnay Masters 2017

Deadline : 1st August 2017

The Global Riesling Masters 2017

Deadline : 1st August 2017

Click to view more

The Global Organic Masters 2017

The drinks business is thrilled to announce the launch of The Global Organic Masters

The Drinks Business Awards 2017

Now in its 15th year, the db awards have become the most authoritative, internationally respected badge of achievement in the alcoholic drinks industry.

The Asian Cabernet Sauvignon Masters 2017

the drinks business Hong Kong announces its first year of The Asian Cabernet Sauvignon Masters.

Rioja Masters 2016

Now in its fifth year, the competition will recognise and reward the finest Riojas on the world stage.

Click to view more