China-funded bottling plant in South Australia targets Chinese wine market

A new bottling plant in South Australia funded by Chinese investors is set to export more affordable bottled South Australian wines to China.

An AU$5m investment was made by four Chinese investors to establish Harbour Bottling, a bottling plant in Osborne.

The plant is ‘four kilometres away’ from the Flinders Port Container Terminal, the major port of Adelaide. The proximity to the habour is expected to ‘significantly reduce the logistics costs’ for local wineries, according to the investors.

The company provides a one-stop service to South Australian wineries who wish to export their wines to China, the investors said. The contract service provided includes bottling, storage, label design, packaging and export logistics, said the investors.

Chinese custom figures show that in 2015, imports of bottled Australian wines rose by 56% in volume and 78% in value year-on-year. A free trade agreement between China and Australia has yet to properly take effect. When it does, it is set to gradually abolish import tariffs on Australian wines by 2019.

‘Chinese consumers prefer (imported) wine bottled in its home country,’ Jason Zhao, executive director and key investor of Habour Bottling, told Adelaide newspaper The Advertiser.

The company aims to initially sell 300 containers of South Australian wines to 40 distribution outlets in China, said the investors.

These wines, mainly reds, are likely to be sourced from regions including Barossa Valley, Coonawarra and the Limestone Coast, according to local media.

The four Chinese investors, Wayne Chao, Simon Hou, Jonathon Li, Jason Zhao are from backgrounds including wine export, real estate, media and marketing, according to the company.

The investors employed Matthew Barton, former packaging line manager of Penfolds’ owner Treasury Wine Estates, as its general manager.