By Tess Ikonomou in Canberra

Australian wine producers expect it will take years before they recover the roughly $1.1 billion in sales to China, following Beijing’s removal of punishing tariffs on imports. 

The Chinese Ministry of Commerce announced late on Thursday it was “no longer necessary” to impose sanctions on Australian wine imports.

They were slapped on by Beijing at the height of diplomatic tensions in 2020.

The decision removes one of the last major sanctions on $20 billion worth of Australian exports, although restrictions remain on lobster and beef.

Australian Grape & Wine chief executive Lee McLean said it could potentially take a decade for the market to recover, with less than $10 million worth of wine being exported annually since the sanctions.

“It will take years to get back… but, having said that, even if we get to half of what it was in a short period of time, that’s still a really significant export market for Australia,” he said.

“There’s no single market or collection of markets that can replace what we’ve lost in China over the last couple of years.”

Mr McLean said despite the “hugely positive” decision, his industry was still pushing for market diversification.

“That effort to grow opportunities in other markets is ongoing, and we’re going to need to keep doing that,” he said.

“We don’t want to get into a situation where we’re solely focused on China.”

Assistant Trade Minister Tim Ayres said China’s decision was a result of the “really hard and determined work” put in by his government.

“It is a very welcome development that comes on the back of of the $20 billion worth of impediments to Australian exporters. Wine was the biggest final part of that piece,” he told Sky News.

Senator Ayres said it was going to take time for Australian wine to make a comeback, but noted the “enormous appetite” for high quality products in China.

“I’m expecting to see a rapid take-up where there are existing markets,” he said.

“I’m optimistic about how that’s going to proceed, but it’s going to depend on all of these commercial realities.”

Jumping on the removal of tariffs, which came into effect from Friday, the NSW government will roll out events in partnership with the industry to help Australian companies re-enter the market.

NSW Trade Minister Anoulack Chanthivong said China was his state’s largest two-way trading partner.

“We understand that the market has changed, and conditions will be different this time around,” he said.

“Our focus will be to support NSW wineries to understand the new environment, re-enter the market and re-establish export pipelines.”