China lifts tariffs on Australian wine as three-year trade freeze comes to an end

02 Apr 2024 --- The Ministry of Commerce of China announced the removal of anti-dumping and countervailing duties on imported Australian wines, effective immediately. This decision follows an evaluation of the prevailing market conditions in China’s wine sector, indicating a shift toward removing the remaining trade barriers on F&B products.

“The Ministry of Commerce, in a ruling, determined that due to changes in China’s relevant wine market conditions, it is no longer necessary to impose anti-dumping duties and countervailing duties on imported wines originating in Australia,” says the country’s commerce ministry in an official statement.

In 2020, amid a diplomatic discord, Beijing had imposed hefty tariffs exceeding 200% on Australian wine products. This measure prompted Australia to challenge the impositions at the World Trade Organization, a legal battle that Canberra decided to withdraw last year amid signs of warming ties.

Trade policy shift
The announcement from the Chinese commerce authority has been welcomed in Australia. A statement from the Australian government, including comments from the prime minister, foreign affairs minister, trade and tourism minister and agriculture, fisheries and forestry minister, expressed collective appreciation.

“Since 2020, China’s duties on Australian wine effectively made it unviable for Australian producers to export bottled wine to that market. Australia’s wine exports to China were worth AU$1.1 billion (around US$720 million) in 2019. We acknowledge and thank Australian grape growers and wine producers for their fortitude and support during a challenging period.”

“The removal of duties means that Australia will discontinue its legal proceedings at the World Trade Organization. We will continue to press for all remaining trade impediments affecting Australian exports to be removed, which is in the interests of both Australia and China.”

Prime minister Anthony Albanese remarked on the broader efforts his administration has made in reducing trade barriers, highlighting the government’s determination to remove duties on other Australian exports like lobster and beef.

Lobsters imported from foreign countries, especially Australia, have been regarded as high-end products in China.Last summer, China removed the tariffs it had imposed on Australian barley. Later in December, China lifted a ban on meat exports from three Australian companies.

Lobster market dynamics
China’s Ministry of Agriculture reports that the demand for lobsters among consumers has remained robust over the past decade.

China stands as the predominant market for Australian lobster, with over 90% of rock lobsters being exported there prior to the export ban in 2020.

According to the General Administration of Customs, China’s major source of rock lobsters is now New Zealand, which accounts for almost 40% of the total market share, followed by Mexico and the US at 20% and 16%, respectively.

With the ban remaining in effect, imports of lobsters from Southeast Asian countries, including Indonesia, Thailand and Vietnam, have also doubled since 2019.

By Sichong Wang

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