MENU

Forget the ‘food bowl’. These three pictures make us the ‘wine glass of Asia’

Credit: Penfolds

Remember the great infant formula boom of 2016 and 2017? Remember the rush of Chinese ex-pats buying Australian vitamins and sending them back to family, friends and assorted other customers?

Remember how China was going to underpin the continued growth of Australian food and other assorted agriculture?

Well, that’s all true. But the dark horse, at least for those who haven’t been paying attention to the data is something far more dear to many of our hearts: the humble Australian table wine.

Well, not so humble, actually, when you check out the data. And therein lies the great opportunity for Australian viticulture.

Check out these tables, courtesy of Wine Australia:

Source: Wine Australia

Check out those countries in the table at the top. Our top wine destination by value, by the length of the straight at Flemington, is China.

And it’s growing at 55%.

Not only that, but on volume terms, it’s closing on the UK fast, and is even money to take top spot by this time next year.

Now have a look at this one:

Source: Wine Australia

Get the picture? Australian export growth is driven by China. And the Chinese are demanding not the cheap plonk, but the top-shelf, I-hope-you-bought-the-platinum-Amex variety. The bean-counters at Penfolds owner, Treasury Wine Estates (ASX:TWE), should be happy!

All of the growth, materially speaking, is at the top end of the price curve. Yes, the lower price points are also growing, but check out the cumulative growth of the $20-plus wine. And the $50-plus segment.

China is now, and will remain for many years, key to Australia’s economic prosperity. For now, it’s true that iron ore is top of the pops. But keep a weather eye on the Australian wine industry, as well as the broader ‘Made in Australia’ theme, including tourism.

The future is very bright. And has a floral bouquet and notes of cigar and chocolate. And is paid for in Yuan.

I don’t know the Mandarin word for ‘Cheers’, but I have a feeling I’ll be learning it soon — and hearing it a lot in the years to come.

The ASX small cap up 285% with no sign of stopping...

One Australian company has developed a state of the art device that's revolutionizing hospitals all over the world. Even better, this device is so profitable that the company rakes in 90% margins. That's a lot of cash. So no wonder the stock's up 285% since 2008 – with no signs of stopping...

To discover the name and code, simply click the link below. You'll discover our expert's #1 medical technology pick... and you can decide for yourself whether to get invested today.

Click here to claim your free report.

Motley Fool contributor Scott Phillips has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Treasury Wine Estates Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.