The S&P/ASX 200 Index (ASX: XJO) fell by 1.26% to 6,518 points.
Here are some of the main highlights from the ASX:
Treasury Wine Estates Ltd (ASX: TWE)
The Treasury Wine Estates share price fell by around 7% today after providing an update in relation to the Chinese move to essentially put tariffs on its products. It was one of the worst performers in the ASX 200.
Treasury Wine Estates said that a deposit rate of 169.3% will be applied to the imported value of the company's wine in containers of two-litres or less.
The ASX 200 share expects that whilst the Chinese measure is in place, demand for its portfolio in China will be extremely limited.
The company said it has continued to developed a detailed response plan, which will commence immediately. Benefits are likely to be limited in FY21, but it will progressively reach the full potential over a two to three year period. The initiatives aim to reduce the impact on earnings and maintain the long-term diversification and strength of its business model and brands.
Treasury Wine Estates plans to reallocate some of its wine from China and grow in other Asian markets outside of China, Australia, the US and Europe. It will invest in sales, marketing and capability across these other luxury growth markets to increase demand and grow the distribution of Penfolds.
Its luxury grapes will be used for other premium Australian portfolio brands including Wynns, Wolf Blass, Seppelt and Pepperjack.
The company also plans to lower its costs, lower its future vintange intake plans and accelerate its multi-country of origin portfolio growth strategy with a focus on growing sourcing for its portfolio from its existing asset base in France and potentially from China.
For Treasury Wine Estates, China represented approximately two-thirds of the total Asia region earnings, or 30% of its total earnings.
The CEO of Treasury Wine Estates, Tim Ford, said: "We are extremely disappointed to find our business, our partners' businesses and the Australian wine industry in this position.
"We will continue to engage with MOFCOM as the investigation proceeds to ensure our position is understood. We call for strong leadership from governments to find a pathway forward."
Select Harvests Limited (ASX: SHV) result
Nut business Select Harvests announced its FY20 report today.
Its almond volume increased by 2.5% to 23,250MT. However, the price per kilo fell by 12.8% to $7.50 per kilo. This caused the total revenue to drop by 16.8% to $248.3 million.
Select Harvests' earnings before interest, tax, depreciation and amortisation (EBITDA) sank 39.3% to $57.8 million because of lower global almond pricing and higher water costs. Total earnings before interest and tax (EBIT) dropped 51.6% to $38.7 million. Net profit after tax (NPAT) dropped 52.8% to $25 million. Operating cash flow was $13.2 million with the timing of cash flows impacted by COVID-19.
Part of the decline of profit was because of very high water prices due to the drought. Annual water costs went up $8.7 million to $21.5 million.
However, the company pointed to the fact that global demand is responding to historically low almond prices, with record US monthly shipments to key world markets.
The start of the 2020/2021 water season has seen better weather conditions and a movement of water prices back towards long-term averages.
Select Harvests managing director and CEO Paul Thompson said: "Tree health and the crop outlook remain positive, with good pollination and growing conditions to date, however it is too early in the horticulture cycle to be able to confidently forecast the 2021 crop at this stage. We will continue delivering a full horticultural program to maximise yield."
The Select Harvests share price fell by around 5% today.
