France has overtaken Australia to become China’s No.1 wine supplier, based on the latest Customs data, a result of the crippling tariffs slapped on Australian wines.
 
According to the first quarter wine imports data released by Chinese customs, Australia is no longer China’s top wine exporter, a position it has held since 2019 when the 14% import tariffs were completely scrapped because of the two countries’ Free Trade Agreement.
 
However, since last year, the two trading partners have embroiled in political and economic spats that saw China launching a twin investigation into Australian wines last August. This led to temporary tariff of up to 212% in November last year and a formalized 218% tariffs announced this March.
 
 
The impacts were immediate. From January to March this year, France has outstripped Australia to become China’s No. 1 bottled wine supplier in volume terms (27.1 million liters), with a stunning growth of 16% compared with the same period last year.
 
Chile came in second with another impressive 23% growth (15.83 million liters), as the data shows. China’s overall value of wine imports are not yet available.
 
This indicates that just within a span of less than four months, French and Chilean wines have emerged as the two main substitutes for Australian wines, which previously account for roughly 40% of market share in China.
 
Australia during the first three months of the year exported only 4.23 million liters of wines to China, down by 81%, according to the customs data. This echoes a set of grim data released by Wine Australia earlier that showed since December last year till March, Australian wine exports to China plunged from AU$325 million to AU$12 million.
 
Spain came in third at 10.61 million liters, down by 4% over the same period. Italy’s export volume to China slightly dropped by 1% to 7.38 million liters.
 
Interestingly, despite the fact Australian bulk wines are spared from the punitive tariffs, as the target is only for wines in containers over 2 liters, Australian bulk wine exports to China also plunged significantly.
 
Bulk wine imports from Chile grew by 17% to 18.58 million liters, while bulks coming from Argentina grew 10% to7.38 million liters year on year.
 
France shipped 2.3 million liters of bulk to China during the period, a drop of 15%, while Australia’s bulk wine exports only arrived at a mere 1.47 million liters, down by 80%.