Treasury Wine shares fall as China opens investigation alleging Australian dumping

Treasury Wine shares fall as China opens investigation alleging Australian dumping

After imposing restrictions on certain abattoirs and slapping an 80 per cent tariff on barley this year, the Chinese Government has today singled out another Australian agribusiness for scrutiny.

The Chinese Ministry of Commerce has announced it will carry out an anti-dumping investigation into Australian wines - an allegation "categorically rejected" by Federal Minister for Agriculture David Littleproud.

"Our farmers are amongst the most efficient and least subsidised producers in the world  recognised as second only to New Zealand in our levels of support," Minister Littleproud said.

"While we respect the right of any nation to defend their domestic producers from unfair and uncompetitive trade practices, we reject any claim that Australian wine product has been "dumped" into China.

"I note that this anti-dumping investigation will run for up to 12 months, and I am committed to working with the Australian wine industry to ensure that all necessary information is provided to refute any claim that Australian wine is being dumped."

The Minister described Australian wine as among the best quality and most popular in the world, exported to numerous markets globally.

"That reputation has been recognised by Chinese consumers who have helped make China our largest export market with $1.1 billion exported in 2019/20," he said.

Treasury Wine Estates (ASX: TWE) was not mentioned in the Chinese Government announcement, but investors in Australia's most well known listed wine company have looked for the exits with shares down 14 per cent at the time of writing at $10.60 each.

The news comes just days after Treasury Wine Estates reported positive signs of recovery in the Chinese market including sales growth of 40 per cent in June.

"TWE will of course co-operate with any requests that we receive for information from Chinese or Australian authorities," the group said in a statement today.

"TWE has had a long and respectful relationship with China over many years through its team, partners, customers and consumers."

Treasury Wine Estates noted its focus would remain on building premium and luxury brands, investing in the local operating model and team, and working with partners to enhance the wine category and grow.

"As an importer of high-quality, premium Australian wine, including brands such as Penfolds, TWE remains committed to China as a priority market and will continue to invest in its Chinese business and its relationships with customers and consumers," the company said.

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