Insight #1 – Chinese producers will be key beneficiaries of Australian wine tariffs Following discontent about Australia’s calls for an investigation into the origins of COVID-19, China has responded with tariffs of up to 200% on Australian wine. From 28 November, importers of Australian wine will have to provide potentially non-refundable “anti-dumping security deposits” amounting to 107-212% of the value of the wine. For some Australian wine makers, the tariffs could be devastating. Treasury Wines (TWE AU), owner of the Penfolds Grange brand, will likely see its company-wide profit drop around 20-30% due to a ~50% drop in ex-factory prices in China. Roughly 120 million litres of Australian wine is imported into China each year, compared to a domestic production of 800 million litres. Based on this simple analysis, it is not inconceivable that domestic Chinese producers could see an acceleration in revenue growth of more than 10 percentage points in 2021. Famed speculator Jim Rogers mentioned in an