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UK demand for Oz wine up in wake of Covid and Brexit

Published:  03 February, 2021

Sales of Australian wine in the UK have been boosted since the advent of the Covid-19 pandemic and in the months leading up to Brexit, according to Wine Australia’s latest Export Report. 

It revealed that for the 12 months ended December 2020 the UK increased by 29% in value to AU$456m and 19% in volume to 266 million litres (29.6m cases). 

Wine Australia said the latest figures saw the UK extending its lead as the biggest destination for Australian wine exports by volume. This is followed by the USA, Mainland China, Canada and Germany.

The average price received for Australian wine from the UK increased by 9% to $1.71 per litre FOB (free on board), the highest level since September 2011.

The UK news comes as Australia revealed that overall wine exports had slowed for the country. 

In the 12 months to December 2020, exports decreased by 1% in value to $2.89bn, as Chinese tariffs took their toll on exports. 

The Chinese Ministry of Commerce announced a decision to impose temporary deposit tariffs from 28 November 2020 of between 107.1% and 212.1% on Australian wine in containers of up to two litres, ahead of finalising its anti-dumping investigation into Australian wine 

Exports to Mainland China were immediately down following the imposition of the temporary tariff in November. 

However, there was a 0.5% increase in volume to 747m litres (83m 9-litre case equivalents) in 2020 and a 1% decline in average price to $3.87 per litre FOB.

Wine Australia CEO, Andreas Clark, said that despite the Covid-19 pandemic, exports hit a record year-on-year value of $3.1bn in the 12 months ended October 2020, before recording a steep decline in the final two months of the calendar year. 

Clark added that there had been a sharp increase in exports from August to October, primarily to Mainland China and the UK, while the decline in November and December was predominantly in exports to China.

However, the decline in exports to China had been off set by a “significant growth” in exports to Europe, up 22% to $704m – the highest value in a decade. 

“Wine businesses are resilient and are already adapting to these changed market conditions, increasing their engagement in markets other than China, particularly the UK, USA, Canada and the domestic market”, he said.

In August 2020, Wine Australia announced that the value of Australian wine exports to the UK had increased by 3% to AU$383m in the 12 months ended 30 June 2020.