There are growing concerns in the Australian wine industry about the deadly coronavirus, which started in the Chinese city of Wuhan in Hubei Province and is spreading across the country and the world.
Australian Foreign Minister Marise Payne today announced that the travel advice had been updated to “reconsider your need to travel” to China with the virus having already killed more than a hundred people in China.
More than $25 billion was wiped off the value of Australian companies yesterday. Shares in Treasury Wine Estates slumped by 5.76 percent with investors concerned about a short-term hit to premium wine sales, but there were other contributing factors including the company announcing that it is now expecting earnings to lift five percent compared with a 15 percent uplift previously forecast.
Wine Australia CEO Andreas Clark said he would be sending this update out today:
“In light of the coronavirus outbreak in China, I wanted to reach out to let you know how Wine Australia is managing our ongoing activity in the China market.
“Following a request from the Shanghai local government, our China-based staff will not go back to the office before 9 February. Those who are able to are logging in remotely and working from home.
“Of course, our first concern is our colleagues’ welfare, so I am very pleased that they are safe and well.
“We also are concerned about the well-being of our exhibitors and suppliers and this concern will guide any decisions we make about proceeding with or cancelling events.
“At this stage, it is too early to make a decision about Chengdu in March, Vinexpo Hong Kong in May and the China Roadshow in June, noting that the Chinese government has cancelled events in February where there would have been large gatherings of people but to date no action has been taken about events in March or later.
“We are monitoring the situation and liaising with the Department of Foreign Affairs and Trade and we will be guided by their advice. We will keep you informed as the situation evolves.”
The coronavirus is also expected to have a big impact on Australian wine tourism which is already struggling because of the bushfires.
Many shops and restaurants in China have closed their doors as people stay away from crowds.
Winemaker Mitchell Taylor told The Australian Financial Review there was “the potential for a downturn in demand” as restaurants and bars suffered from a sharp decline in customers.
Thirteen cities including Wuhan (11 million people) are in lockdown as the death toll climbs.
Hong Kong has closed many of its border crossings with mainland China.
Chinese New Year festivities were shut down which had a big impact on Australian rock lobster exports.
Australian wine exports to China (including Hong Kong and Macau) reached a record value of $1.25 billion in the 12 months to September last year – an increase of 18 percent.
The World Health Organisation has not yet officially declared the coronavirus a pandemic.
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