China’s Ministry of Commerce stated Tuesday it is releasing an anti-dumping examination into some red wines imported from Australia.
Australia’s Federal Trade Minister Simon Birmingham stated in a declaration that Chinese authorities “have also advised Australia that they are considering a request to launch a countervailing duties investigation.”
“This is a very disappointing and perplexing development,” Birmingham stated, including that “Australian wine is not sold at below market prices and exports are not subsidised.”
The statement comes in the middle of growing geopolitical stress in between the 2 nations. China is Australia’s leading export market, and without a doubt the biggest location for the island continent’s white wine exports by worth, according to the federal government’s market authority, Wine Australia.
The Chinese examination targets “wines in containers holding 2 liters or less,” according to an English translation on the Commerce Ministry site.
A common bottle of white wine has to do with 0.75 liters.
The anti-dumping probe follows a demand in early July from the China Alcoholic Drinks Association, the Chinese Ministry of Commerce stated in a different online declaration Tuesday. The query will check out possible disposing throughout 2019, and market damages for the years 2015 to 2019, the declaration stated.
The examination will last for one year — till August 18, 2021 — with the capacity of being extended till February 18, 2022, under unique scenarios, according to the ministry.
Australia had the biggest share of China’s imported white wine market at 37%, according to information for the 12 months through May from Global Trade Atlas and mentioned by Wine Australia in an August 4 report.
France was 2nd at 27%, followed by Chile at 13%, the report stated.
Shares of Australian white wine huge drop
Trading in shares of Australia’s most significant white wine business Treasury Wine Estates was quickly stopped pending a statement, according to a declaration on the Australian Stock Exchange site. The shares toppled more than 13% in Tuesday trading.
Treasury Wine Estates later on stated in a declaration launched by the Australian Stock Exchange that the business will work together with any ask for info from Chinese or Australian authorities. The business included it will stay concentrated on constructing its premium and high-end brand names, and usually working to grow its contribution to China.
It was not instantly clear whether Treasury Wine Estates belongs to the Chinese probe.
James Pearson, CEO of the Australian Chamber of Commerce and Industry, stated in a declaration to CNBC that in addition to preserving the enduring trading relationship with China, the Australian federal government requires to assist the domestic market discover brand-new trading partners and construct emerging markets.
Australia exported 62% of its white wine produced in the 12 months through completion of June, according to Wine Australia’s report.
Mainland China was without a doubt the biggest market by worth, with exports increasing 0.7% to 1.1 billion Australian dollars ($790 million), the report stated, keeping in mind development in exports at greater rates and a decrease at the lower-end of the marketplace.
Wine Australia referred a CNBC ask for remark to the nationwide market association Australian Grape and Wine.
The company stated in a declaration that: “We believe that the Australian grape and wine sector is well placed to respond to this investigation and Australian Grape & Wine and our exporting companies will cooperate fully.”
“The Australian industry welcomes the opportunity to build on these ties and work with the Chinese industry and government to further technical cooperation and develop lasting relationships,” the association stated.
— CNBC’s Will Koulouris added to this report.
