Treasury Wine Estates has made a strategic move to reinforce its renewed presence in China’s market by spending US$18 million on one of the country’s most significant wineries. In a deal that will complete in the middle of next year, Australia’s biggest producer is buying 75% of Stone & Moon Winery Co in the northwestern province of Ningxia. Stone & Moon has 43 hectares of vineyards and a modern winery which is said to be easily enlargeable. It grows several grape varietals, including Cabernet Sauvignon and Marselan, which have already been used by TWE’s flagship brand, Penfolds, in some of its China-origin wines. The move underlines the importance of the China market to TWE and will further develop Penfolds’ multi-country sourcing strategy. The Stone & Moon deal also reinforces TWE’s strategic push to expand local wine production. Even during the three-year tariffs dispute between Beijing and Canberra, Treasury not only continued to supply the market with Penfold’s lines produced in California and France, but it also retained staff ready for the reopening, and In 2022, it introduced its first Ningxia-sourced wine, One by Penfolds. Chinese embargo During China’s effective embargo on Australian wines, TWE strengthened demand for Penfold’s in south east Asian markets such as Vietnam and Thailand but chief executive Tim Ford always retained a focus on China, which had been its largest export market, saying that the eventual return would be a form of ordered progression. When it launched One by Penfolds in 2022 Penfolds managing director Tom King
This Article was originally published on The Drink Business - Wine
