The Australian - The Deal - - Cover Story - Wine-con­sum­ing na­tions

Fresh and fruity, or a full-bod­ied red? When­ever Aus­tralian wine ex­porters ask them­selves such a ques­tion th­ese days, the an­swer al­most al­ways de­pends onChina. Hunter Val­ley-based wine mar­keter Brian McGuigan, for one, is cer­tain China will be a game-changer forAus­tralia’swine in­dus­try in the long term. But right nowhe is fo­cused on the high dol­lar and the need to be as lean as pos­si­ble amid fierce com­pe­ti­tion for the palates of global wine con­sumers. “When it’s 70 cents to theUS dol­lar, ev­ery Aus­tralian wine ex­porter thinks it’s Christ­mas,” McGuigan says. “But at par­ity or above, it’s re­ally dif­fi­cult.”

The sit­u­a­tion calls for in­no­va­tive styles and pro­duc­tion so­lu­tions, in­clud­ing lo­cat­ing the bot­tling, la­belling and pack­ag­ing as close to tar­get mar­kets as pos­si­ble. In th­ese dif­fi­cult con­di­tions, many in the Aus­tralian in­dus­try sees China as a po­ten­tial saviour.

But, of course, so does ev­ery other wine ex­porter, from­mar­ket leader France to vol­ume pro­duc­ers Chile, Spain and Italy to up-and­com­ers such as the US andNew Zealand. In a rapidly ex­pand­ing­mar­ket, Aus­tralia’s share of vol­ume is fall­ing as theChileans and Span­ish, in par­tic­u­lar, bom­bard China with rel­a­tively cheap wine for bulk blend­ing by Great Wall, flag­ship brand of state-owned food pro­cess­ing and trad­ing con­glom­er­ate COFCO.

This fo­cus by ex­porters re­flects one sim­ple fact: China may not be the big­gest im­porter of 1 France 2 US 3 Italy

4 Ger­many

5 China Source: In­ter­na­tional Or­gan­i­sa­tion of Vine & Wine

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