Rathbone Wine Group chief executive says Chinese buyers still cautious

“When I first started travelling up to China in 2007, Chinese consumption of wine had a lot to do with status, and there wasn’t really a good understanding of flavours of wine; they saw it as a strange Western thing … to put on the table when they were eating Western food,” Rathbone says.

“When a lot of the younger Chinese were studying abroad, while living here, they developed a taste for Australian wine, and when they returned to China, they brought that education with them, introducing their understanding of wine … that was a big part of Australia’s success.”

Although China exports dwindled after the introduction of the tariffs, Rathbone says he still maintained strong relationships with his Chinese customers, partly in the hope his business could bounce back swiftly as soon as they were lifted.

It has only been a month, but trade has been tougher than he initially anticipated, and he has wound back his expectations for the China market. He hopes China would eventually make up 5 per cent of the Rathbone’s revenue within two years.

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“In the lead-up to the tariffs being dropped where there was a lot of speculation, I hoped we would get orders on the expectation of it being dropped, but that didn’t occur. It wasn’t until the absolute confirmation that orders came,” Rathbone says.

“There is a lot of conservative apprehension with Chinese customers. Their economy is not as strong as five years ago, so there’s a hesitancy to place big orders. And having been out of the market for some time, Chinese winemakers have filled the market, and it also feels like some South American producers have taken advantage of us exiting the market.”

If international competition before 2020 seemed tight, it has only become worse, compounded by shipping problems dating back to the pandemic, growing tensions in the Middle East and a drying Panama Canal.

Rathbone says it is not unusual for his wines, travelling all over the world, to be either stuck on a ship or in containers at ports for long periods of time. He says he has needed to book ships for exports at least a month’s notice, compared to a week in advance before the pandemic.

“However, Chinese customers are still very, very positive, and they’re excited to be trading again,” Rathbone says.

“They still see that Australian wine is well sought after by the consumers in China, and there’s still a positive reputation for Australian wine.”

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