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China topples US as Australia’s top export market

China has overtaken the US to become Australia’s most valuable export market, fuelled by the increased demand for higher priced bottled wine.

The latest stats from Wines of Australia showed the value sales of wines to China grew 51% to AUS$474 million during 2015 – up from AUS$27 million ten years ago – with more than a third of the wines priced AUS$10 and above now being destined for the Chinese market. This end of the market is now valued at AUS$190 million, marking an increase of 63%, it said.

Wines of Australia attributed this “exceptional” growth to the China-Australia Free Trade Agreement, as well as the rising interest in wine among the growing Chinese middle classes, who are drinking imported wine more frequently.

Negociants International executive director, Adam O’Neill said demand showed no sign of abating. “The rapidly maturing palate of consumers and the ability to reach them through online platforms such as TMall has us confident that this growth will continue, particularly at higher price points,” he said.

Sales across the whole of North East Asia were strong, with Hong Kong, its fifth most valuable market, up 7% to AUS$126 million, and Singapore also seeing 9% growth. Malaysia, Taiwan and South Korea all saw strong double-digit growth, albeit of a smaller base, but value sales in Japan declined 3% as the proportion of bulk wine rose.

The boom in China has toppled the US as Australia’s highest value market, a position it has enjoyed for seven years, although the value of US exports rose 4% to AUS$448m. The US enjoys a 21% share of Australia’s value and volume sales and saw gains at higher price points – the average value of wine exports hit their highest levels since October 2009, for example, up 12% to AUS$2.93 per litre, driven by bottled exports rising 5% to AUS$393 million.

The figures show the UK remains Australia’s largest market by volume – with 33% of the country’s wine making its way to UK shores, compared to China’s 12% – but around 83% of the volume comes from bulk wine affecting its value growth. Exports to the UK fell 3% to AUS$361 million, giving it a 17% market share of the exports by value. Although there was an 11% decline in exports below AUS$2.50 per litre, wines priced AUS$5–$7.49 per litre grew 38%, just behind AUS$10 wine at 20%.

However wine exports to Europe overall fell -3% to AUS$570m.

Growth of premium

Overall exports of Australian wine rose 10% to AUS$2.17 billion, much of this driven by higher priced bottled wines, according to Wine Australia CEO Andreas Clark.

“The latest figures show that Australian wine exports continue to see strong growth and it’s our finest wines that are most in demand,” he said.

Bottled exports grew by 14% to AUS$1.8 billion, with the average value of bottled exports up by 9% to AUS$5.47 per litre, the best performance since 2003.

“More than half of the total value growth in the last 12 months was in wines priced at $10 or more per litre free-on-board (FOB); value was up 28% to a record AUS$547 million.”

“These encouraging export figures are the result of the hard work put in by the entire sector to defend and grow Australian wine’s share in our critical export markets,” he added.

One response to “China topples US as Australia’s top export market”

  1. Jitendra Gandhi says:

    Amazing artical we need more info on this type on china.

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