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Australian
wine exports to China soar - by
Dominique Patton - Source: ap-foodtechnology.com -
18/05/2006
Volumes
of Australian wine exported to China grew almost 350
per cent last year, making it an increasingly important
market for wine producers.
The Australian Wine and Brandy Corporation
(AWBC) says the country, which has only started consuming
wine in recent years, is now its tenth largest export
market in volume terms.
It bought 8 million litres of Australian wine during
the 12 months to April 2006, with bulk red wine accounting
for three quarters of the increase in sales.
The
volumes are still significantly lower than those imported
from Chile and Spain, both responsible
for a significant share of the total 40 million litres
of bulk sent to China in the last year.
Imports of wine have surged since 2004
when Chinese import duties dropped from 65 per cent
to just 14 per cent as a result of its accession to
the WTO.
But much of the bulk wine is being bought
by domestic wine producers who blend the beverage with
their own wines.
“The imported bulk tends to be
better quality than a similarly priced Chinese wine,”
said Carl Crook, managing director of Montrose China,
one of the countries longest established wine importers.
“The big brand names are buying
it to improve the quality of their own product,”
he told AP-Foodtechnology.com.
It is thought that producing wine in
China is still more costly than more established wine
growing nations.
China's ministry of commerce expects
domestic wine production to increase by 15 per cent
each year until 2010, when volumes will reach 800,000
tonnes but imports are also likely to continue growing
as the prices continue on a downward trend that could
soon meet the prices of Chinese producers.
Crook added that imports are not the
same thing as sales.
“We've seen a flurry of distributors
opening up and making a lot of orders but they could
just be sitting in inventory,” he said.
Ali Hogarth, responsible for developing
emerging markets for the AWBC, says that the tariff
change has undoubtedly boosted imports but there are
other factors benefiting imported wines.
“The government has been encouraging
the drinking of grape wine after a bad year of grain-based
alcohol, even offering wine at banquets instead of the
grain variant,” she said.
“We're also seeing high-priced
premium wines benefiting from the awareness of wine's
health benefits in China,” she said.
She added that Australian producers
are highly regarded in the Chinese market, with a reputation
for a good grape-growing environment.
More than half of all China's wine sales
still come from three domestic companies (Great Wall,
Dynasty and Chang Yu).
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