Australian winemaker eyes growth potential

Chinese consumers continue to play an important role in Australia's wine industry, with China remaining the country's largest wine export market. Amid this, an Australian winemaker has expressed confidence in the Chinese market's long-term growth potential.

Melbourne-headquartered wine group Treasury Wine Estates, or TWE, said strong consumer demand in China continues to support the firm's business growth, while highlighting the importance of the premium and luxury wine segments amid evolving drinking preferences.

China remained Australia's largest wine export market by value in 2026, according to Wine Australia, a government statutory authority.

The country regained its position as Australia's largest wine export destination after tariffs on Australian bottled wine were removed at the end of March 2024, and has maintained that position since.

The latest figures show that Australian wine exports to the Chinese mainland were valued at A$756 million ($528 million) in the 12 months ending June 2026, compared with the country's total wine exports of A$2.3 billion during the period.

The importance of the Chinese market is also reflected in the performance of Penfolds, TWE's flagship brand.

According to TWE's 2026 annual report, China led Penfolds' global growth in depletions, up 34.7 percent year on year. "Depletions" in the wine industry refer to sales volume from distributors to retailers.

TWE CEO Sam Fischer said that Penfolds' depletions growth in China was driven by factors including strong consumer demand and improved market conditions.

"China has always been an important market, and we remain confident about the long-term growth opportunity, with Penfolds transcending the wine category as a true luxury brand," Fischer said at the company's annual shareholder meeting last week.

According to the latest report from Wine Australia, global wine consumption continues to weaken as consumers increasingly moderate alcohol intake, face cost-of-living pressures and shift toward alternative beverages. The decline in Australian wine exports mirrors this broader global trend.

TWE is responding by sharpening its focus on premium and luxury wines, with plans to increase investment in brands including Penfolds.

"Luxury wine remains an attractive segment, supported by ongoing premiumization as consumers drink less but better," Fischer said.

Jack Wu, managing director of Greater China at TWE, told China Daily that Chinese consumers continue to show strong appreciation for "quality, provenance and trusted brands" in premium wines.

"We believe Chinese consumers continue to value premium experiences and products that offer authenticity, heritage and craftsmanship," Wu said, adding that the evolving market presents further opportunities for Australian wines.