China's potential tariff lifts no silver bullet for Riverina wine industry

Growers say that even if the Chinese wine market opens, they will still face profitability challenges as the Chinese demand for red wine has reduced, and red wine surplus persists.

"We just hope it [the Chinese market] comes back soon, but even if it does come back, we are not going to get a full volume of wine, like we did before 2020," Chairman of Riverina Winegrape Growers Bruno Brombal said.

"We might start off slowly, we might get 20 per cent of what we use to deliver to China."

The Australian wine industry was devastated when China halted exports of Australian wine in March 2021.

At its peak in the 2010s, Chinese demand for red wine accounted for 40 per cent of the industry's total export value, a market that dried up overnight following the bans.

Mr Brombal says that Australian wine will need to compete with other international wines to take back its market share in China.

He is also concerned that the oversupply of wine in the Australian market will continue to cause unprofitable prices.

"First you've got to get into the market, and then you've got to cut their market," he said.

"Our prices started dropping and they're still dropping. They're below the cost of production by hundreds of dollars at this stage."

Mr Brombal fears for the future of the Riverina wine industry which has struggled to be profitable since 2021.

"We are losing the young growers, they're not staying on the farm to lose money when they can go and get a job anywhere else and make money," he said.

China was around 35 per cent of Borambola Wines owner Tim McMullen's business before the tariffs.

He has begun speaking with previous Chinese customers in anticipation of the market reopening.

"I've had customers who are ready to go and wanting samples and stuff like that, which is encouraging," the Gundagai vigneron said.

However, Mr McMullen is wary that the Chinese market for wine has contracted as the pandemic and tougher economic times set in.

"If they're not eating out, dining out or entertaining, then on a business level, they're not consuming lots," Mr McMullen said.

"Be prepared, it's not going to be like it was before."

Federal Member for Riverina and opposition spokesman on international development and the Pacific Michael McCormack is hopeful that China will lift its trade tariffs.

"I welcome any easing of restrictions of tariffs that are being placed on Australian growers, of course I do. And of course, the industry is going to welcome it too," he said.

"The yield is still up and the quality is still up despite it being reasonably dry in recent months."

He said winegrowers are also facing challenges surrounding the cost of water, labour shortages and industrial relation laws.

Australian trade minister Don Farrell says he will discuss trade barriers with his Chinese counterpart at the World Health Organisation conference in Abu Dhabi on February 26.