Australian winemakers are looking to China’s fast-growing market.
● WhileChinaisundoubtedlyafast-growingconsumermarket,itisalsohighlyfragmented, competitive, and prone to changes in consumer taste. Chinese demand may give a long-run boost to Australian producers, but it is unlikely to prove their salvation in the short term.
●    Australian wine exports: 7% to China (+36% on LY), 35% to UK (+4%) 28% to USA (-15%).
●    Australian domestic consumption fell 21% annualised in Q1, 2011 – biggest decline in 20 years.
●    China's wine consumption is forecast to increase 20% annually, to 126.4 million cases by 2014.
●    Australia's problems of a soaring $, droughts, wildfires and floods, have been compounded by a global consumer shift away from Australian wines.
●    While the world at large has turned away from Australia’s “one-note” wines over the past half decade, it is those very traits – simplicity and directness – that may endear them to Chinese consumers.
●    Chinese drinkers clearly favoured direct, single-image wines with low tannin levels. ●    Australian winemakers face two overriding challenges in the China market: reputation and
distribution.
●  Australian wine exports to China grew 27% last year, China’s overall wine imports grew by 61%.
●  Shanghai Bright Food Group is rumored to be considering buying Treasury Wines, which is overextended. I
●  If Chinese firms start acquiring troubled Australian vineyards, it could lead to a major influx of Australian wines into China, similar to what Pernod Ricard’s acquisition of Orlando Wines did for the country in European markets.
http://www.chinaeconomicreview.com/en/content/grapes-hope