Money Australian wine exports to China just smashed through the $1 billion mark

02:16  17 april  2018
02:16  17 april  2018 Source:   Business Insider Australia

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Highlighting China 's interest in Australian wine is the fact that just ten years ago, wine exports to China were worth just million annually. "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

The value of Australian wine exports has surged 13% to AU.44 billion in the past 12 months ending 30 September, with mainland Explaining the growth, the trade organisation said: “The reduced tariffs through the China – Australia Free Trade Agreement has seen exporters now shipping

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Australian wine exports to China have jumped a massive 51% over the last 12 months to create the country's first $1 billion market.

New figures released by Wine Australia today reveal that exports increased by 16% in value globally to $2.65 billion, over the year to March 2018, with China's thirst leading the way.

Wine Australia CEO Andreas Clark said that figure was the highest in a decade, while volumes also grew by 10% to 844 million litres.

Bottled wine exports increased by 15% to $2.15 billion, while the average value of bulk wine rose by 8% to $1.05 per litre. Both are the highest levels since 2009, when the GFC hit exports.

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The strongest growth was in China , which grew 66% to A0 million. Impressively, there were 1 ,517 active exporters in 2015 (up from 1 ,395 in 2014) and Australian wine was exported to 122 destinations.

SYDNEY (Reuters) - Australia 's annual wine exports to China jumped 63 percent by value in 2017, industry figures showed on Tuesday, as high-end sales rose and a free trade agreement signed two years ago cut import duties.

The higher growth in value over volume means the average value per litre of exports increased by 5% to $3.14 per litre.

There was substantial growth in higher value wines, with exports above $10 per litre making up around a third of total exports at $779 million.

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U.S. wine exports to Greater China (Mainland China , Hong Kong and Taiwan) were strong with 10% growth to over 0 million in 2017.U.S. wine exports , 97% from California, reached $ 1 .53 billion in winery revenues and 380 million liters (42.2 million cases) in 2017.

Premium wines worth $20 per bottle or more experienced substantial growth of between 42% and 68%, with the $15-$19.99 price bracket the only one to experience a decline, at 18%.

Wines above $200 soared 42%.

Clark said that while the commercial end of the USA market was in decline, contributing to the drop in volume, there had been strong growth in the premium sectors.

The $30–49.99 segment increased in value by 25% to $5 million.

Overall, the US market was down 7% by value to $439 million.

However, Americans were drinking better, with sales at the $US8–11.99 per bottle doubling and $US20–24.99 bottle sales up 22%.

The Wine Australia boss said low Northern Hemisphere harvests helped drive demand for bulk container exports, with volumes up 10% to 462 million litres, and the total value of bulk wine exports rose 19% to $486 million.

"Every country in Australia’s top 10 bulk wine destinations recorded an increase in average value, especially Germany, the largest importer of wine in the world, where average values for bulk wine increased by 20% from $0.87 to $1.05 per litre," he said.

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According to Wine Australia , the value of Australian wine exports in the 12 months to June 30 rose 5 per cent to $ 1 .89 billion , the first time the value of exports has increased on a financial year basis since We are looking to grow sales, whereas before we were just managing minimal profitability.’’

* Exports to China more than double since FTA deal in 2015. * Tariffs to fall further, more growth expected. * Chinese growers look to buy Australian The rise also helped Australia boost its total wine shipments to their highest in a decade last year, up 15 percent to A.56 billion (.05 billion )

Falling tariffs as the China–Australia Free Trade Agreement kicks in helped in that market ahead of their total removal in January 2019. As a result, mainland China overtook the USA to become Australia’s second largest export market by volume, but more than double the US by value.

The $1.04 billion in total sales to China included Hong Kong and Macau.

The United Kingdom is Australia’s largest export destination by volume, up 8% to 241 million litres over the last year, and third by value at $373 million, a 9% increase.

Shiraz is the country's most popular export, jumping 16% over the past year to $609 million by value, well ahead of its nearest rival, cabernet sauvignon, which leapt 25% to $357 million.

Chardonnay is the only white grape among the top 5 varietal exports, coming fourth at $177 million.

Domestically, Australian wine sales in the off-trade retail market rose 3% in value to $3.5 billion in the 12 months to March 2018, with the $15–30 per bottle segment showing the largest growth.

Australia's wine industry was worth $5.6 billion in FY2017 - a rise of 8%, with 1.37 billion litres of wine produced, up 5%.

Here's an infographic on Australian wine exports over the last 12 months.

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