The growth of Australia’s wine exports to China is declining due to a drop in global wine consumption and reduced demand from Chinese consumers.
Australia’s wine exports to China, which saw a sharp increase following renewed diplomatic relations, are now facing a downturn. This slowdown, coupled with a global drop in wine consumption, raises uncertainties about the future of the Australian wine market.
After Beijing lifted tariffs on wine imports on March 29, 2024, Australia exported slightly over A$1 billion ($640 million) worth of wine to China during the year ending in March 2025, approaching the record A$1.15 billion achieved in 2020, according to Wine Australia, the nation’s wine industry regulator.
Despite the rebound, exports sharply declined in early 2025, with only A$126 million shipped in the first quarter—the lowest figure since 2016.
China’s trade restrictions, introduced in 2020 during political disputes, caused a considerable oversupply of wine in Australia, leading to sharp declines in grape prices and the closure of vineyards. Despite regaining access to China’s market, Wine Australia highlighted that oversupply challenges remain, as China now imports fewer bottles, focusing on higher-priced options.
Adding to the difficulty, Australia’s wine exports to other international markets fell during the 12 months leading up to March 2025. Peter Bailey, market insights manager at Wine Australia, noted that Australia could benefit if China enforces new tariffs on U.S. wine, which might reduce American wine exports by approximately $50 million annually. He also mentioned Canada’s increasing move away from U.S. wines as a potential opportunity for Australia.
Although Australia’s wine industry has gained from restored access to the Chinese market, it continues to grapple with challenges as global consumption trends evolve and competition grows fiercer.
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