Even now Penfold's wines are readily available in China. The...

Even now Penfold's wines are readily available in China.

The impact on the tariffs on TWE is not as big as people realise. TWE was pretty clever about they played things. They are a global player, so Penfold's still exists in China, just with TWE's South African and US wine in most of Penfold's bottles.

When the tariffs were introduced, TWE was affected and had to make a few changes but they could and did manage it pretty successfully and their profits remained stable through the drama. Of course, what that means is that the bounce back will not be as big either, but it is good that their brand has always been in people's faces throughout it all. And brands are important because their is little trust and a lot of fakes, this is true in general but also in the wine market.

It was the small producers who were selling substantial volumes into China that really got hit. Unlike TWE they had no alternatives. Ironically, many of these were small wineries are owned by Chinese people. They had huge advantages because they could sell their wine to one of their other businesses, usually wine bars, or restaurants and do tax shifting like the global nationals. I know of a person in this position. They are warehousing their wines, but their whites are basically unsaleable now because they have been in storage too long and have lost their fruitiness. Some of the reds are also reaching the point where they need to be drunk as well. Its going to be hard to shift them in time because there are a lot of wineries in the same situation.