Import Australian Wine: Trends and Opportunities in Malaysia

by admin on August 8, 2011

Export sales of Australian wine far exceed local consumption as Australia has become the 6th largest exporter following France, Italy, Chile, US and Spain. Emerging markets in Asia, particularly in Malaysia where distributors now import Australian wine, provide excellent opportunities for wine exports where Australia is currently the market leader capturing a market share of 50%. This translates to a yearly supply of approximately 3.1 million litres in 2008.

Malaysia’s liquor market was traditionally dominated by brandy, followed by whisky and wine. In recent years, this market experienced a steady shift as the number of wine drinkers grew, presenting valuable opportunities to import Australian wine.

Factors affecting wine market

Affluent lifestyles: In Malaysia, drinking wine is considered a sign of cultural refinement. More wine is being consumed as part of the lifestyle of an increasing number of affluent and sophisticated consumers.

Expatriate community: Malaysia’s sizeable expatriate community regularly consumes wine.

Tourist consumption: Malaysia is a favourite destination among tourists who account for its wine consumption.

Young wine drinkers: This segment of drinkers views wine consumption as modern and upbeat.

Women drinkers: More women are drinking white wine.

Wine prices: Drinkers are turning to wine as a healthier alternative to hard liquor such as brandy or whisky. In addition, wine prices are now affordable and within reach of more drinkers.

Awareness and promotion: Regular promotion of wine in 5-star hotels, wine tasting sessions and formal wine classes increase wine awareness in Malaysia.

Opportunities

Malaysia’s wine market is relatively young with plenty of room for growth. Export opportunities exist in the supply of:

  • dry red table wines
  • dry white table wines
  • sparkling wines
  • fortified wines

Competition

The wine market is subdivided into 3 price groups: inexpensive (between RM35 to RM50), mid-priced (between RM60 to RM100) and premium (RM110 and higher). The inexpensive group is dominated by wine exported from Australia, Argentina, Chile and South Africa. Australian wines also lead the mid-priced group although South African and Chilean wines are showing great potential. The premium price group appears to be the only segment that patronizes the Old World producers such as France and Italy. This market is composed of mature drinkers who tend to shift to Old World wines as a natural progression from the New World variety.

Reduced tariff on exports covered by the Asean, Australia, New Zealand Free Trade Agreement (AANZFTA) and the absence of import quotas and restrictions are favorable for wine distributors who want to import Australian wine in Malaysia. Malaysian distributors must obtain import licences from the Royal Customs and Excise Department to start importing.

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