Grapes of wrath: dark clouds for Australian winemakers as China ties sour

Diplomatic quarrels between Canberra and Beijing are spilling over into the business world, threatening to upset the rising star of Australian exports: wine

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Australian wine is increasingly popular with Chinese. Photo: Reuters

Published: 10:15am, 16 Jun 2018Updated: 10:22am, 16 Jun 2018

Set in the rolling green hills outside the Queensland capital of Brisbane, Sirromet Winery has placed big bets on China. Exports of its Australian vintage now make up 30 per cent of its total sales, double what it was five years ago. Such is its popularity that Sirromet is now visited regularly by tourists from mainland China, necessitating the need for dedicated Mandarin speaking guides.

“The Chinese really buy into the quality of the product and the fact it’s natural and grown in a clean environment,” says Sirromet general manager Rod Hill.

But dark clouds are appearing for Australian winemakers such as Sirromet. The booming billion-dollar export trade to China is souring amid increasingly acrimonious relations between Beijing and Canberra. Australia often says its economic prosperity is linked to China, its biggest trading partner. But what happens when a country’s biggest trading partner is also accused of meddling in its internal affairs causing a deterioration in relations not seen since the dark days of the cold war?

Chinese tourists sample wine at an Australian vintner. Photo: Reuters

For Australia’s wine industry, which has ridden a surge in demand from China’s middle classes, it spells disaster. Wine shipments are now being delayed at major Chinese ports, with the blame apportioned to the cooling in the relationship. With Australian newspaper headlines screaming about sinister Chinese influence in business, education and politics, winemakers are not the only businesses nervous about the freeze between Beijing and Canberra.

How Australian wines breached the Grape Wall of China

Last year, Australian journalists on a study tour of the mainland were warned of a possible boycott of a wide range of Australian goods because of what China calls unfounded accusations against the mainland. Now, with bottles of Australian Chardonnay and Riesling languishing dockside, those warnings appear to have been at least partly correct.

Beijing, which until recently had considered Australia a reliable trading partner best known for blue skies, koalas and kangaroos is increasingly angry at Australia for what it considers politically motivated attacks on Chinese citizens living in Australia.