China pumps up Oz wine exports to $2.55 billion

Australian wine exports increased by 34 percent in value to $2.55 billion and by seven percent in volume to 649 million litres in the 12 months ended December 2024, according to Wine Australia.

The increase in value was a result of high levels of shipments to mainland China between April and December 2024, after tariffs on Australian bottled wine were removed at the end of March 2024.

In those nine months, 83 million litres of wine, worth $902 million, have been exported to mainland China.

The average value of exports to mainland China for the 12 months ended December 2024 was $10.79 per litre, contributing to a 24 percent increase in the average value of total packaged exports to $9.35 per litre – a record value.

Peter Bailey, manager, Market Insights, Wine Australia said, “While there has been month-to-month volatility in the value of shipments to mainland China in the period since tariffs were removed, the performance is nonetheless very positive.

“However, Chinese wine consumption is much lower than it was before the import tariffs were imposed, so it will take more time before it becomes clear what the ‘new normal’ level of exports to mainland China will be, after this initial restocking period.

“Continued growth is not assured, and it is still important to focus on market diversification in a challenging global business environment.”

Figure 1: Value of shipments to mainland China in 2024.

Outside of the unique circumstances relating to exports to mainland China, global alcohol consumption is facing numerous headwinds, and this is impacting the results to other markets.

In many established wine markets, consumption is declining due to health and wellness concerns and the rising cost of living.

This has contributed to a global oversupply of wine and increased competition in already strained supply chains.

Australian wine exports to the rest of the world declined by 13 percent in value to $1.64 billion and seven percent in volume to 565 million litres during the 12 months to December 2024.

The decline in value was largely driven by Hong Kong, after a large increase in shipments to this destination at the end of 2023 likely driven by some Australian exporters anticipating the removal of import tariffs in mainland China in early 2024.

A decline in unpackaged wine exports to the United States after a period of heightened exports further contributed to the volume decline.

Figure 2: Value of Australian wine exports

Exports to North America declined by five percent to $482 million, driven by the United States, with growth in exports to Canada offsetting some of the decline.

There were mixed results by destination in Europe.

The value of shipments to the region declined by four percent to $521 million, with exports to the United Kingdom, Germany, Denmark and the Netherlands declining.

Meanwhile, exports to Sweden, Belgium, Finland, Ireland and Poland increased in value.

Outside of mainland China, most other Asian destinations declined in exports during the 12 months to December 2024, although the long-term growth rate in value for the region (excluding mainland China) was still positive at four percent per year in the last five years.

The top five destinations by value were:

Mainland China (up $898 million to $907 million),
UK (down $9 million to $352 million),
US (down $38 million to $325 million),
Hong Kong (down $125 million to $171 million), and
Canada (up $13 million to $156 million).

The top five destinations by volume were:

UK (down 8 million litres to 212 million litres),
US (down 28 million litres to 106 million litres),
Mainland China (up 83 million litres to 84 million litres),
Canada (down 7 million litres to 66 million litres), and
New Zealand (down 2 million litres to 27 million litres).

The increase in exports to mainland China has also impacted on red wine’s share of exports as 93 percent of exports to China are red in colour.

In the 12 months ended December 2024 the volume share of red and rosé wine increased from 54 percent to 60 percent.

Meanwhile, white wine lost share – moving from 46 to 40 percent of volume as Australia’s top white wine destinations declined in exports. Consequently, the top three varieties in red wines – Shiraz, Cabernet Sauvignon and Merlot – all increased in volume shipped, while the top three varieties in white wines – Chardonnay, Pinot Gris/Grigio and Sauvignon Blanc – all declined.

What’s changed in China and the opportunity for Australian winemakers