News Special Coverage Industry Overview Supply & Demand Price Reference Forum
 

China’s top 10 wine exporters in 2021

vino-joy.com by NING SANG LAWATI14/03/2022  

China’s stringent ‘Zero-Covid’ policy, as well as the ongoing harsh tariffs on some major exporters, have hindered the recovery of the country’s wine imports in 2021.

According to the latest figures released by China Association for Imports and Exports of Wine and Spirits (CAWS), among all categories of alcoholic beverages, imported wines’ market share slid further last year, down to 30.8% behind spirits and beers.

China wine imports saw a slight downturn trend in 2021, with its market share shrunk by 30.8% among all wines and spirits imports.

In 2021, China’s wine imports further slid by 7.4% to US$1.69 billion on a low comparing base of 2020, while the import volume recorded a moderate decrease of 1.4% to 420 million liters.

The decline in import value is a result of reduction in bottled wine imports. In 2021, bottled wine imports in China dropped by 8.7% to US$1.58 billion in value, due to the drastic decrease in wine imports from Australia after the anti-dumping tariffs. Only 300 million liters of bottled wine was imported last year, a 7.2% decrease from 2020.

1.png

On the other hand, bulk wine imports rose by 17.3% in value to US$100 million, while the import volume was up by 16.7% to 120 million liters. 

Sparkling wine imports also saw a 57.91% growth in value to US$114 million. 11 million liters of sparkling wine was imported to China, a year-on-year increase of 13.5%.

Despite the overall downward trend, CAWS suggested China’s wine imports market is adapting to the “post Australian anti-dumping period”, as all major importing countries generally recorded a positive growth in imports, except for Australia.

However, there were also other challenges crippling China’s wine imports. While the country’s ‘Zero-Covid policy’ during the pandemic has already dampened on-trade sales, a new wave of consumer favouritism to domestic wines have further undermined the attractiveness of imported wines. 

For now, here are the top 10 wine exporters to China in 2021.

No 10. Germany

Germany exported 4.58 million liters of wine, a 22.9% increase from 2020. The total import value from Germany totalled US$27.1 million, which rose by 31%. 

Despite growth in both import value and volume, Germany only ranked in 10th position compared to 8th in 2020, surpassed by fast-growing imports from New Zealand and South Africa.

No 9. New Zealand

New Zealand took over Germany to become the 9th largest wine exporter to China. 

In 2021, New Zealand exported 2.68 million liters of wine to China, an increase of 29.01% more compared to the previous year. The country’s import value rose by 49.6% to US$27.3 million.

While its neighbour Australia is suffering from up to 218% anti-dumping tariff, New Zealand wines on the other hand greatly benefited from a more friendly trade relationship with China via Free Trade Agreement.

The lenient trade restrictions for New Zealand narrowed its gap with Australia’s wine exports to China. New Zealand wines now took up 1.62% of market share in China, while Australia’s market share drastically reduced to 3.27%, down from almost 40%.

No 8. South Africa

With its export volume almost doubled, South Africa rose into the top 10 list in 2021 with a staggering growth rate over 100% in both import value and volume.

It exported 14 million liters of wine to China, which is close to a 193% growth compared to 2020. Its export value also rose by 125%, totalling US$34 million.

Since the start of COVID-19 pandemic, South Africa has introduced four alcohol bans which led to panic stockpiling of South African wines. Despite the fourth ban being only lifted in July, concerns towards the enforcement of a fifth ban surfaced by year end as the country’s Covid cases surged.

China’s tense relationship with Australia also opened up opportunities for South Africa to export both bottled and bulk wine to China. 

In terms of value, bulk wine imported from South Africa soared by 1256.13% to US$3.59 million, while bottled wine rose 105.05% to US$30.8 million.

No 7. Argentina

Argentina exported US$37 million worth of wine in 2021, a 33% year-on-year increase, but the export volume dropped by 23% from previous year to 29.2 million liters.

Notably, despite the fact that its average export price rose by 73.07% to US$1.28 per liter, its average export wine price still remains the lowest in the top 10 list.

In 2021, Argentina’s wines took up 2.22% of China’s import wine market, still far behind its South American neighbor Chile.

No 6. US

The US levelled up to 6th position from 7th in 2020 with a 2.41% market share in China’s wine market.

In 2021, the US exported US$41 million worth of wines, a significant increase of 75.24% from the previous year. Its export volume also rose by 37.63% and reached 7.4 million liters.

The notable growth in American wine export value to China shows the persistent demand for American wine despite the 93% punitive tariffs imposed during the Trump administration. 

Even though President Joe Biden has not lifted the duties, the American wine exports to China are catching up. After China imposed the tariff of up to 218% on Australian wine, California wines appeared more affordable and were back on wine merchants’ list again.

The launch of Penfolds California collection in the Chinese market might have also contributed to the growth in the American wine category. 

No 5. Australia

Bound by the punitive anti-dumping tariff formalised since March 2021, Australian wine exports to China suffered a drastic drop of over 90% in both value and volume terms.

Australia, which used to take up almost 40%of China’s imported wine market, now its market share only stands at 3.27%. In just a year, Australia was dethroned from being the top wine exporter to China to fifth largest one.

In 2021, Australia only exported around 9.3 million liters of wine, a devastating decline of 91.09% compared to 2020.

By value, the country’s wine exports to China plummeted by 92.24% to US$55 million. The average price for Australian wine exports to China slumped by 12.83% to US$5.96 per liter.

As the tariffs apply to wines in bottles under 2 liters, Australian bottled wine exports to China took a more serious hit than bulk wine, which dropped by 93% in value and 94.2% in volume. As a result, Australia only exported US$47.5 million and 5 million liters of bottled wine to China in 2021.

Australia’s bulk wine exports to China also declined by 77.7% in value and 75.2% in volume. It merely exported US$7.8 million and 4.2 million liters of bulk wine to China last year.

Last June, Australia requested the World Trade Organization (WTO) to investigate China’s tariffs on Australian wine exports for a second time. Later in October, WTO agreed to establish a dispute-settlement panel to address its complaint over China’s tariffs but no further progress has been made on the dispute since then.

No 4. Spain

Being the world’s third biggest wine producer, Spain is now China’s fourth biggest wine exporter with 8.64% market share. 

Spain exported 64 million liters of wines, worth US$146 million to China last year, up by 57.9% in volume and 49.3% in value respectively, from 2020.

The major driver behind the growth could be the surge in bulk wine exports. In 2021, Spain’s bulk wine exports to China surged by 260.6% in volume to 13.7 million liters. 

By value, Spain exported US$7.98 million worth of bulk wine to China, a 237.6% year-on-year increase.

The average price per liter dropped by 5.44% to US$2.27, which is relatively low among China’s top 10 importing countries.

No 3. Italy

Italy ranked fourth among China’s largest wine suppliers in 2021. Good news for the largest wine exporter in the world is that it has expanded its market share in China to 9.78%.

The country’s wine exports to China increased by 43.72% to US$165 million. The average price per liter rose by 14.67% to US$5.14. Its export volume also expanded by 25.33% to 32 million liters.

Australia’s void in China’s wine market has provided a great opportunity for Italy to promote its wine to Chinese drinkers. Last year, Italy actively promoted its wine through roadshows, tastings events and wine fairs. 

While Australia has to endure the tariffs in about four more years, the dedication of the Italian government and wine merchants may push Italy to win over more market share in China in near future.

No 2. Chile

Chile rose as the second largest wine supplier to China with 19.63% market share, only second to France. 

In 2021, Chile exported US$332 million worth of wine to China, up by 50.72% from the previous year. In terms of volume, it has shipped 127 million liters of wines to China, a year-on-year increase of 45.35%.

For a long time, Chilean wines were associated with cheap wines or good value options. But Chilean premium wines started to rise in the wine world in 2017, in which Chinese drinkers became the largest consumer market supporting its premiumisation trend.

Chile is also the biggest bulk wine supplier to China with 58.91% market share. In 2021, Its bulk wine export recorded a massive growth of 101.57% by value, totalling US$63 million. 60 million liters of Chilean bulk wine were exported to China, which is an increase of 62.04% compared to the previous year.

Reputed for its affordability, the average price of Chilean wine exported to China was US$2.61 per liter, a slight year-on-year increase of 3.7%.

Chile, same as New Zealand, enjoys zero tariffs on wine exports to China. With no surprise, the affordable wine price of Chilean wines became an attractive option to wine importers compared to Australian wines hit by heavy tariffs and the most costly New Zealand wine.

No 1. France

France returned to its throne as the top wine supplier to China last year, after Australia took over its position in 2019.

After Australia wines lost its lust when China finalised the anti-dumping tariffs last March, French wines became the top choice as the substitute for Australian wine with its well-established reputation in China.

In 2021, France exported US$753 million worth of wine to China, a 48.11% increase from the previous year. It has exported 115 million liters of wine to China, representing a 14.42% increase in export volume.

The strong demand for Bordeaux wine in China is a major driver behind the growth of French wine exports to China.

Around 54 million bottles, or around one in five exported Bordeaux bottles, were shipped to China in 2021, according to the Bordeaux Wine Council. Notably, Bordeaux alone accounts for 67% of all French AOP wines exported to China in volume and 72% in value.

France was also the biggest supplier of bottled wine and sparkling wine to China last year. 

France dominated China’s sparkling wine imports with 72.8% market share. It exported US$82 million sparkling wine in 2021, a significant year-on-year increase of 84.64% from its previous pandemic loss. 2.5 million liters of sparkling wine was shipped to China, up by 43.35%.

For bottled wine, France took up 46.76% market share with 103 million liters and US$740 million worth of wines shipped to China, which rose by 14.54% and 48.22% respectively.

Along with Chile and Italy, the three countries now take up over 70% of China’s imported wine market share.