Australian wine exports show steep decline

Bad news all round for the struggling Australian wine industry.

Australian wine exports declined by 7% in value to $2.30 billion and 6% in volume to 598 million litres in the year ended June 2026, Wine Australia’s latest Export Report released today shows.

This is the first time that export volume has fallen below 600 million litres since 2004.

The decline mirrors a broader global trend of declining wine consumption over the past decade.

The total export figures reflect increasingly difficult trading conditions across many of Australia’s key export markets, driven by a historic downturn in global wine consumption.

Worldwide wine consumption has fallen to its lowest level since 1961, as consumers increasingly moderate alcohol intake, face cost-of-living pressures and shift towards alternative beverages.

Wine Australia manager for market insights Peter Bailey said the challenges facing Australian wine exporters were not unique, with other wine-producing nations facing the same conditions.

“Data from multiple sources suggests the decline in wine consumption globally is more than a short-term downturn - it's a reflection of changing consumer behaviour that is reshaping demand around the world.

"This reinforces the importance of understanding where demand exists and the products and occasions that are driving consumer decisions.

“While global trading conditions remain challenging, Australia wine continues to perform relatively well in many key markets where it generally maintained or grew its share of imported wine over the past year.”

The decline was driven primarily by weaker demand in Australia's three largest export markets: mainland China, the United Kingdom and the United States.

Mainland China remained Australia's largest export market by value, despite exports falling 15% to $756 million as the initial post-tariff recovery and restocking phase came to an end.

“While exports to mainland China declined over the past year, Australia remains the leading source of imported wine in the market,” Bailey said.

“The market is no longer being driven by the re-stocking of Australian wine, rather we’re seeing a more mature and demand-led phase, reflecting a smaller and slower-growing Chinese wine market than existed prior to the imposition of tariffs in late 2020.”

The United Kingdom remained Australia's largest market by volume and the United States second, although export volume to both markets fell to their lowest level in 25 years.

Canada was a standout performer, with export value increasing 20% to $188 million - its highest level in seven years - and volume rising 13%.

Australia's smallest grape vintage for 25 years

Australia’s 2026 wine grape crush fell to 1.27 million tonnes - its smallest since 2000 - but the reduced national crop did not result in stronger grape prices, Wine Australia’s National Vintage Report 2026 reveals.

Released today. the report says the national crush is estimated to be 1.27 million tonnes, down 300,000 tonnes (19%) from the 2025 crush and 25% below its 10-year average of 1.69 million tonnes. 

This equates to around 33 million fewer 9-litre cases of wine - not necessarily disturbing at a time when demand is reduced. 

Wine Australia manager for market insights, Peter Bailey, said that this year’s crush reflected both seasonal pressures and a broader response to changed consumer demand.

“A number of significant seasonal challenges, including flooding in the inland regions, had an impact on production, but the main driver of this lower crush is a deliberate adjustment in response to changing market conditions,” Bailey said.

“There have now been four vintages in a row below the long-term average, suggesting an underlying reset in the tonnage of grapes required by winemakers to meet changing global demand.”

Overall, the 2026 crush was 306,334 tonnes smaller than 2025, with red varieties accounting for 80% of the decrease. 

The crush of white grapes declined by a more modest 62,774 tonnes (9%) resulting in a big jump in white’s share of the total crush - up six percentage points to 53%. 

This is only the second time in the past 12 years that whites have accounted for the majority of the crush.

Mr Bailey said this shift was likely a reflection of changing global consumer preferences toward white wine.

Bailey noted that the drop in average values across the board had occurred despite the very low crush size, which is expected to take pressure off wine stocks.

“There has been no improvement in grape prices, which suggests that demand is still very soft,” he said. “It’s concerning that there is no sign of recovery for reds despite such a significant adjustment, and that prices for whites are also now declining.”

The National Vintage Report is available on Wine Australia’s website. 

Coincidentally, Wine Tasmania today released its 2026 vintage report with Tasmanian producers celebrating "exceptional quality, intense flavours and vibrant freshness" despite facing one of the lowest-yielding and most challenging growing seasons on record.

Following a record-breaking 23,002 tonnes in 2025, the 2026 vintage will be remembered for its scarcity at just 11,163 tonnes, roughly equating to around 10 million bottles.

A historically cold, dry and brutally windy spring severely impacted flowering and fruit set across the island, dramatically reducing bunch weights and overall yields, with some growers reporting yields of 50% below last year.

Sheralee Davies, CEO of Wine Tasmania, praised the resilience and skill of the island’s grape growers and winemakers who navigated the season’s demanding conditions.

“If 2025 was a year of abundance, 2026 is a vintage of absolute concentration and character - for both our grapes and growers,” Davies said. “Nature threw everything it had at the island this season - from late spring frosts and unrelenting winds to a cool, drawn-out summer which delayed harvest by up to 3-4 four weeks in some areas.”

Reflecting the focus on quality not quantity, Tasmania’s 2026 wine grape harvest represented just 0.9% of the country’s total by volume, but 5.0% of the national value.

Canadians proving keen on Australian wine

Canada should be a major market for Australian wine producers, particularly given the ongoing boycott of goods from the US. 

But when I visited late last year I was surprised how few quality Australian wine were available on LCBO shelves in Ontario.  

Now Australian winemakers are seeing renewed momentum in Canada, with new export and sales data along with feedback from importers pointing to a surge in demand for premium, regionally distinctive wines. 

That's the precise market I noted back then: https://www.gourmetontheroad.com/2025/11/plunging-us-wine-sales-to-canada-create.html

In the 12 months to March 2026, Australian wine exports to Canada rose 24% in value to $188 million and 15% in volume to 69 million litres, Wine Australia reports. 

The number of Australian exporters active in the market to 220 businesses.

Small steps from a low base, but important nonetheless. 

While 2025 restrictions on US wine imports reduced the availability of American products across Canadian liquor boards, producers say the strong performance of Australian wine over this period reflects groundwork laid over several years. 

Sustained engagement with buyers, retailers and sommeliers has strengthened understanding of Australia’s quality, diversity and regional strengths, positioning Australian wine to expand as shelf space became available, Wine Australia says.

Matt Fowles of Fowles Wine said the premium category’s momentum reflected renewed consumer interest in Australian wines with a strong sense of place.

“Our focus in firmly on fine wine, and it’s clear customers value having these wines back on shelves,” Fowles said. “When the regional story and provenance are understood, the category lifts quickly.”

Over the past two years, buyers from major provincial liquor boards including Ontario, Quebec and British Columbia have visited Australian regions through in-bound programs, while ongoing in-market activity including tastings, masterclasses and trade education has strengthened understanding of modern Australian wine.

Collectively, these visits have contributed to 177 new liquor board listings, expanded training for retail and on-premise staff and strengthened advocacy among sommeliers.

Vancouver-based importer Peter Marshall of Sur Lie said first-hand experience has played a critical role in shifting buyer confidence.

“Buyers who have travelled to Australia approach the category with far greater confidence,” Marshall said. “That first-hand experience reshapes their perceptions and opens the door to more distinctive and adventurous Australian wines.”

Libby Nutt, general manager marketing and export sales at Casella Family Brands, said engagement with buyers had strengthened relationships and delivered consistent commercial outcomes.

“Our relationships with the liquor boards have always been strong, but they’ve deepened significantly as more buyers travel to Australia,” Nutt said.

“These visits have driven real alignment, and we’ve secured new listings every time we reconnect. Each engagement is opening new doors and strengthening our presence in the market.”

At a recent trade event in Vancouver as part of Wine Australia’s North America Roadshow (top image), almost 100 key trade, buyers, media and sommeliers attended. 

Opportunity for young Australian wine industry professionals

Are you an ambitious young professional working in the Australian wine industry? 

Applications are now open for a new bursary giving Australian grape and wine professionals aged 35 and under the opportunity to attend the Institute of Masters of Wine International Symposium 2027, an influential forum for wine education, ideas and debate.

The bursaries are designed for emerging professionals who want to accelerate their careers, expand their global perspective and bring new thinking back to Australia’s wine sector, Wine Australia says. 

Open to people working across viticulture, winemaking, research, marketing and trade, the program removes cost barriers and provides access to learning and networks that are often out of reach early in a career.

Ten successful applicants will receive financial support to attend the IMW Symposium 2027 and engage directly with global experts, Masters of Wine and international peers. 

Emma Symington MW, Head of Education Development, EMEA at Wine Australia, is one of two co-chairs organising the Symposium and was instrumental in establishing this bursary to ensure young and early-career wine professionals have an opportunity to participate.

“Young professionals want to be part of global conversations early and gain confidence that their ideas belong in the room," she said. 

"But often the cost to attend experiences like the International Masters of Wine International Symposium are out of reach for many. As an organiser of this event, I genuinely want to see more young people attending.”

Jenna Vaughan, who oversees the Rootlings program, the national network for young grape and wine professionals funded by Wine Australia, and said the bursary responds directly to what under 35s are seeking from their careers.

“Young professionals want access, not just information." she said. "Being in the room where big conversations are happening changes how you think about your role and what’s possible. This kind of opportunity helps you bring new ideas back to the workplace and apply them on the ground.”

The IMW Symposium 2027 will be delivered by the Institute of Masters of Wine and hosted in South Australia with support from the South Australian Government. Wine Australia is a major sponsor of the Symposium and delivers the bursary program as part of its long-term investment in industry capability.

More information, eligibility criteria and application details are available here.

China Syndrome continues to damage Australian wine industry

Tough times continue for the Australian wine industry with Australian wine exports declining by 8% in value and 6% in volume in 2025.

Value declined to $2.34 billion and volume to 613 million litres, stats in Wine Australia’s Export Report released today show.

The average value of exports also decreased by 3% per cent to $3.81 per litre Free on Board (FOB).

The reduction in overall exports was largely driven by declines in the value of exports to mainland China and the United States and in volume to the United Kingdom.

There were also markets recording value growth for Australian wine including Canada, Singapore, Thailand and Malaysia, which Wine Australia said indicated areas of opportunity for ongoing market diversification.

Wine Australia manager for mrket Insights Peter Bailey said the overall weakened export performance is consistent with the long-term trend of declining wine consumption in major markets around the world.

“Consumers are reducing overall alcohol consumption in line with wellness trends and in order to save money as the cost-of-living increases," Bailey said.

"For wine exporters around the world, trade barriers and regional conflicts are also making it more difficult and costly to get product into markets.”

Exports to mainland China had the biggest impact on the decline in value, as shipments to the market were down by 17% year-on-year to $755 million, following the initial restocking period after the removal of import tariffs on Australian wine

“While the re-opening of the mainland China market at the end of March 2024 provided some temporary relief in the decline in total exports, the Chinese wine market is one-third of the size it was five years ago - impacting both domestically produced and imported wines,” Bailey said.

“While shipment levels in the first three quarters after tariffs were removed were exceptionally positive, consumer demand has been subdued. Chinese consumer confidence has only made minor improvements since falling to an all-time low in 2022 during the Covid-19 pandemic[- which has negatively impacted consumer spending."

The top five markets by value were: mainland China, down 17% to $755 million, UK down 3% to $343 million, US down 12% to $287 million, Canada, up 12% to $175 million, and Singapore, up 18% to $118 million.

For more info see Wine Australia’s Export Report and Wine Australia’s Export Dashboard.

Australia producing too many wine grapes

Bad news today for the Australian wine industry as national stock levels rise.

Wine production exceeded sales in 2024–25, leading to a rise of 5% in national stock levels, The Australian Wine Production, Sales and Inventory Report 2025, released by Wine Australia.

The worsening imbalance between supply and demand comes as global conditions for wine remain tough. 

Analysis of global market conditions suggests that the outlook for wine has deteriorated in the past 12 months. 

Global consumption has continued to decline and remains lower than global production. Consumption is forecast to decrease further in the next five years.

These unfavourable market conditions are compounded for Australia by the high stock levels carried forward from 2024–25. 

The increase in Australian wine stocks without an increase in sales is likely to reduce future demand for wine and wine grapes. As a result, grape prices are unlikely to improve in the next few years.

Results large winemakers in Australia indicated that total Australian wine production from the 2025 vintage was 1.13 billion litres, or 126 million 9-litre case equivalents. This was 9% higher than in 2024, but 7% below the 10-year average of 1.22 billion litres.

The production of red wine increased by 15%, while the production of white wine increased by 2%. 

Wine Australia manager for market insights Peter Bailey said that the result was expected, after the grape crush in 2025 increased by 11%, with nearly 90% of the additional tonnes being red.

“Production was still below the 10-year average, but it was the second vintage in a row where the crush increased from the 20-year low in 2023, despite the high levels of stock going into the 2025 vintage,” Bailey said.

Export sales increased by 3% to 638 million litres, driven by growth in exports to mainland China, which increased by 53 million litres to 85 million litres in the latest 12-month period.

Image: Andrii Omelnytskii, Scop.io

Australia's wine culture on the move

Australia’s wine consumption trends have been put under the microscope with the recent release of a first of its kind report called State of the Grapes, which reveals large-scale shifts in the nation’s palates, our Hunter Valley correspondent Rick Allen reports.

A collaboration between Wine Australia and the Endeavour Group, the report analyses sales data from BWS and Dan Murphy’s and gives an insight into what the wine shelves of the future could look like.

"We are witnessing a significant evolution in how Australians are choosing their wine," says Andrew Shedden, general manager of Premium and Luxury at Endeavour Group.

"Not just fleeting trends, but long-term, global patterns that are reshaping the entire Australian wine landscape.

“From the surging popularity of rosé and prosecco to the 'spritz culture' invigorating the market, consumers are sending a clear message: they want lighter, more versatile, and often more affordable options."

Across every state, there is a clear trend towards lighter-bodied and more refreshing wine styles. 

Varieties such as pinot noir, pinot grigio/gris, rosé, and prosecco have all grown their market share significantly. This comes at the expense of traditional fuller-bodied red wine varieties which have seen a decline in sales since 2018.

Cask wine, sauvignon blanc, traditional red blends and non-vintage sparkling joined shiraz in experiencing the most significant declines over the long term.

Innovation has breathed new life into the wine sector. 

The 'spritz' category (sparkling-wine-based cocktails) has spearheaded this. Driven by Millennial and Gen Z consumers seeking accessible, refreshing and Instagrammable options, the desire for Spritz has the potential to define attitudes towards flavoured and sparkling wine styles.

Value is being prioritised above all else for younger Australians, making promotional deals a big factor in consumer decision making.

Findings suggest that younger drinkers are bypassing the traditional 'rules' of wine and prioritising their personal taste over conventional food pairings or norms. This is changing where and when wine is consumed, challenging its once-dominant place at the dinner table.

Around the states:

Victoria: leading the way nationally with new drinkers and innovation; national leader in Spritz sales; a trend away from shiraz to pinot noir.

NSW: Australia’s leading market, but with less state loyalty than other states, with 90% of sales on wines from other states or countries.

Western Australia: deep loyalty to local producers, with their preference for local heritage and classic varieties; a thirst for prosecco.

South Australia: a growing appreciation for shiraz despite the national decline; the highest commitment of any state to Australian wine.

Tasmania: The highest allegiance to local producers with nearly 20% of wine sales on in-state products, a figure that is eight times the national average.

Image: Elena Pasenko, Scop.io  

Why is Australian wine not making an impact in Canada?

Someone at Wine Australia appears to be falling down on the job. 

And someone at the Liquor Control Board of Ontario in Canada is doing their customers a disservice. 

On a recent visit to Kingston and Toronto in Ontario I visited several different restaurants and there was hardly any Australian wine to be found on any of the wine lists. 

And visits to monopoly LCOB stores showed that while mass market brands like Yellow Tail and 19 Crimes are available in abundance there are hardly any upmarket, or boutique, Australian wines on display. 

This is at a time when all US wines and spirits have been removed from the shelves, creating what should be a huge opportunity for Australian producers with a lake of quality red wine to offload. 

New Zealand, is contrast, has its sauvignon blanc well represented on wine lists. Thee are also plenty of choices from Italy, Spain, France, Argentina and Portugal, among others. 

I purchased a decent Wakefield (Taylor's) Promised Land shiraz an LCBO store to share with family. but there were precious few other enticing options from Australia. 

The question has to be asked: Why is Wine Australia not leaping in to fill the gap caused by the absence of US wines? Particularly as Canadians are comfortable with wines sold under screw cap and have a positive relationship with Australians.

Friends living in Toronto tell me promotions of Australian wine in the fourth-biggest city in North America are non-existent. 

And why is the LCBO offering only mass market Australian options to local consumers? Would they not like to try something different? 

Something, somewhere is very wrong.  

Image: Filotero Venturo, Scopio          

Wine Australia launches new marketing campaign

Wine Australia has launched a new marketing campaign aiming to highlight the versatility of wine styles from around the country.

A barbecue "just because" the sun came out. A lazy night in with your favourite person. A camping trip where the fire crackles and the stories get better as the night goes on.

The campaign is billed as a "fresh new message inviting Australians to see wine differently".

It showcases wines not only as suitable for celebrations and more formal occasions, but as something to share alongside smaller, unscripted moments using the slogan "We make a wine for that."

Australian winemakers use over 100 grape varieties grown in 65 wine regions around the country.

From August 4, people across the country are being invited to take a moment to make a moment, and share their Aussie wine experiences with @_australianwine for the chance to win one of 20 "We make a wine for that" prize packs, valued at $240 each.

A national calendar of Australian wine events is now live at www.wemakeawineforthat.com showcasing wine experiences across the country that wine lovers can get involved in.

China syndrome lifts Australian wine exports

China's renewed appetite for Australian wines has helped drive a 13% increase in export values over the financial year 2024-2025.

In the 12 months ended June 2025, Australian wine exports also increased 3% in volume,  Wine Australia’s Export Report released today reveals.

Peter Bailey, manager, Market Insights, Wine Australia said the latest data shows the impact of the China market reopening in March 2024 is beginning to stabilise.

“The year-on-year increase in exports was almost entirely driven by mainland China after tariffs on Australian bottled wine were removed at the end of March 2024," Bailey said.

"Over 12 months have passed since tariffs in mainland China were removed and the initial surge in exports has eased, resulting in 85 million litres of wine exports to the market in the 12 months ended June 2025, worth $893 million.

“The quarter ended June 2025 was 35% smaller in value than the same quarter in the previous year. This indicates that the level of exports to mainland China may be normalising after the initial re-stocking phase.

“The return of mainland China offers a valuable market, with global wine consumption at its lowest level since 1961. However, it has only had a small impact on total export volume, as the volume shipped to mainland China is half of what it was at its peak in 2018.

“This reflects the decline in wine consumption in the Chinese market over the last five years; the market is now only a third of the size it was in 2019."

In the past 12 months, imports from France, Italy, Spain, and Chile to China have all declined.

Exports from Australia to the rest of the world declined by 11% in value to $1.59 billion and 6% in volume to 554 million litres. 

While the decline in value was mainly driven by Hong Kong as sales transitioned to mainland China, the drop in volume reflected a reduced supply of Australian wine available for export after three smaller vintages, as well as declining demand from key export markets.

In a concerning stat, Australian wine exports to the United States declined by 10% in volume to 111 million litres and 12% in value to $314 million, the lowest value in over two decades.

The US wine market continues to face headwinds that developed after the Covid-19 pandemic, leading to reduced overall wine consumption in the last five years, Wine Australia said.

Health and wellness concerns, particularly among older wine consumers, lack of attachment recruitment to the category from younger generations, increased competition from other alcoholic beverages, high wholesaler inventories, and ongoing economic and political uncertainty, including import tariffs, have all contributed to a suppressed outlook for wine exports to the market in the near-term.

The top export destinations by value were:

* Mainland China, up 123% to $893 million
* United Kingdom, down 1% to $350 million
* United States, down 12% to $314 million
* Canada, up 7% to $157 million, and
* Hong Kong, down 54 per cent to $127 million.

For more information, see Wine Australia’s Export Report

Some positive news for Australian wine producers

The Australian wine industry is celebrating some positive news with the wine grape crush up in 2025 after two record low vintages.

Sadly, it is still below the long-term average and there are negatives.

The 2025 Australian wine grape crush is estimated to be 1.57 million tonnes, 160,000 tonnes (11%) more than the 2024 crush but still 140,000 tonnes below the 10-year average of 1.71 million tonnes, the National Vintage Report 2025, released today by Wine Australia, shows.

The smaller crush relative to the long-term average is likely to have been a result of both seasonal and strategic factors, with a decline in demand for wine globally driving adjustment in the Australian wine sector, according to Peter Bailey, manager for market insights at Wine Australia.

“The 2025 crush equates to around 1.1 billion litres of wine, which is in line with current sales of Australian wine on domestic and export markets,” Bailey said.

The year-on-year increase in the crush was driven by red varieties, which were up by 20%, while the crush of white varieties was 2% higher than in 2024.

“The crush of red grapes is still estimated to be the third-smallest in more than a decade (the past two years being the smallest) and was 9% below its 10-year average, while the crush of white grapes was 8% below the 10-year average,” Bailey added.

He noted that the mix of red versus white was problematic.

“The significant increase in red varieties this year could exacerbate the challenges facing the sector in terms of excess stocks of red wine, and might further reduce demand for these varieties next vintage,” he said.

The total value of the Australian wine grape crush in 2025 is estimated to be $1.13 billion, an additional $136 million (14% compared with 2024.

Bailey said that despite the increases, the average purchase values for warm inland reds in the past two years were the lowest in over a decade, and for many growers would not be sufficient for production to be economically viable.

“Conditions are not likely to improve for red grapes until there is a significant reduction in the supply base,” Bailey said.

“The wine sector needs to continue to work together to bring supply and demand back into balance at a profitable price point for growers and winemakers.”

Shiraz regained its position as the number one variety, increasing by 23%, while chardonnay dropped back to second place, after significant frosts across many regions caused it to decrease by 13%.

South Australia accounted for the largest share of the national crush by size, with 48%. New South Wales was the next largest, with a 33% share of the crush.

The National Vintage Report is available from www.wineaustralia.com/market-insights/national-vintage-report. 

New promotion campaign for Australian wines

The Australian grape and wine sector is being urged to rally behind a new promotional campaign with the message: "We make a wine for that."

This new marketing invites the entire wine sector to connect with Australian drinkers by celebrating the quality and diversity of Australian wine. 

The messaging aims to remind consumers that whatever the occasion, there is an Australian wine that meets their needs. 

From backyard barbecues to camping trips and dinner parties, the idea is there is an Australian wine for the occasion. 

The plan is developed by Wine Australia as part of the One Grape & Wine Sector Plan. 

Dr Martin Cole, CEO of Wine Australia, says the campaign was developed in collaboration with the sector to elevate Australian wine as the beverage of choice. 

“Experts from the sector Joint Marketing Group (JMG) provided guidance and insight to support the development of the campaign and ensure it meets the needs of our very broad business types," Cole said.

“Highlighting Australian wine’s relevance for more occasions was clearly identified as a strong platform to build the campaign around. We already make world-class wines that belong in those moments, so this is our opportunity to remind people of that and give them confidence in choosing Australian wine.

“The real value here is relevance. Showing Australian wine as a relevant option for the moments that matter, with messaging that makes Australian wine feel familiar, local, and easy to choose. We encourage the sector to get behind this campaign, to amplify the message and impact purchasing behaviours for the benefit of the sector." 

Check out wineaustralia.com/wemakeawineforthat. 

Cheers to some good news for the Australian wine industry

Australian wine exports increased by 41% in value to $2.64 billion and by 6% cent in volume to 647 million litres over the past 12 months, Wine Australia’s Export Report released today revealed. 

The average value of exports increased by 33% per litre, the highest average value in almost two decades.

Australian wine exports to mainland China exceeded $1 billion one year after the removal of tariffs. 

“The increase in average value is mainly due to the elevated level of premium wine shipments to mainland China, after tariffs on Australian bottled wine were removed at the end of March 2024," said Peter Bailey, manager for market insights for Wine Australia. 

"The 12 months ended March 2025 represented a full year’s worth of exports to mainland China since the tariffs were eliminated - resulting in 96 million litres of exports to the market, valued at $1.03 billion.

“While the total value of shipments to mainland China is now at a similar level to the years immediately before tariffs on Australian bottled wine came into force, volume in the last 12 months is 23% smaller than the 5-year average between 2016 and 2020 and 44% below the peak in 2018.

“Additionally, the average value of packaged wine shipped to mainland China was $23.00 per litre, much higher than any other major export market. The lower volume and high average value demonstrate that mainland China is a premium market for Australian wine and will therefore not solve oversupply issues in Australia.”

Exports to the rest of the world (excluding mainland China) declined by 13% to $1.62 billion and 9%in volume to 551 million litres, adding to the wine supply glut. 

This was the lowest value to the rest of the world in 10 years and lowest volume in over 20 years. While the decline in value was mainly driven by Hong Kong as sales transitioned to mainland China, the volume drop was due to the declines in exports key destinations such as the United Kingdom, United States, and Canada.

The global wine market is facing considerable headwinds which are impacting on results for other markets aside from mainland China and are unlikely to be resolved in the near-term, Wine Australia said. 

While there has been a long-term trend of consumers drinking less alcohol due to health and wellness concerns, more recent cost-of-living pressures could continue or potentially get worse in certain markets, given the economic and political turmoil taking place globally. 

Escalating trade wars have the potential to increase prices, complicate supply chains, and rapidly change the competitive landscape in key wine markets in the near-term.

The top five destinations by value were:

• Mainland China (up $1.01 billion to $1.03 billion)
• UK (down $12 million to $353 million)
• US (down $32 million to $323 million)
• Hong Kong (down $136 million to $154 million), and
• Canada (up $3.8 million to $151 million).

For more info see Wine Australia’s Export Report and Wine Australia’s Export Dashboard.

 

Where have all the vineyards gone?

The global wine grape harvest in 2024 is estimated to be even lower than the historic low 2023 vintage, reflecting negative weather events combined with active strategies to reduce production, Wine Australia reports. 

In the southern hemisphere, Australia and Argentina both saw substantial increases compared with their 2023 vintages, but remained below their 5-year averages. 

Chile and South Africa both declined to their lowest totals for more than 10 years, and well below their 5-year averages. 

Argentina regained its position as largest southern hemisphere producer, while Chile slipped to third.

Chile is believed to have removed up to 20% of its vineyard area in 2023-24, while New Zealand had a smaller vintage than the past two near-record crops. 

In the northern hemisphere, France saw the greatest reduction: down 23% compared with 2023 and 16%  below its 5-year average. 

Unfavourable weather conditions related to climate change were the main driver, although distillation and removal programs also contributed. 

Italy increased by 7% after its very low 2023 harvest, to reclaim the title of world's largest wine 

producer while Spain saw the largest increase globally - up 18% - to be close to its 5-year average.

International Organisation of Vine and Wine figures indicate that global wine production in 2024 was even lower than 2023, making it two in a row that are the lowest in 60 years.

The 2024 vintage total of 23 billion litres was 10 per cent below the 5- year average. 

Good news - and bad news - for the Australian wine industry

There is good news - and bad news - for the Australian wine industry.

In the 12 months to December 2024, Australian wine exports increased by 34% in value to $2.55 billion and by 7% cent in volume to 649 million litres, Wine Australia’s Export Report released today shows.

That sounds great but the increase in value was a result of high levels of shipments to mainland China between April and December 2024, after tariffs on Australian bottled wine were removed at the end of March 2024.

In those nine months, 83 million litres of wine, worth $902 million, have been exported to mainland China.

The average value of exports to mainland China for the 12 months ended December 2024 was $10.79 per litre, contributing to a 24% increase in the average value of total packaged exports to $9.35 per litre – a record value.

But sales to key markets in the US and UK fell - with the threat of US tariffs looming.

“While there has been month-to-month volatility in the value of shipments to mainland China in the period since tariffs were removed, the performance is nonetheless very positive," said Peter Bailey, manager for market insights at Wine Australia said.

“Chinese wine consumption is much lower than it was before the import tariffs were imposed, however, so it will take more time before it becomes clear what the ‘new normal’ level of exports to mainland China will be, after this initial re-stocking period.

“Continued growth is not assured, and it is still important to focus on market diversification in a challenging global business environment.”

Outside of the unique circumstances relating to exports to mainland China, global alcohol consumption is facing numerous headwinds, and this is impacting the results to other markets.

In many established wine markets consumption is declining due to health and wellness concerns and the rising cost of living.

This has contributed to a global oversupply of wine and increased competition in already strained supply chains.

Australian wine exports to the rest of the world declined by 13% in value to $1.64 billion and 7% in volume to 565 million litres during the 12 months to December 2024.

The decline in value was largely driven by Hong Kong, after a large increase in shipments to this destination at the end of 2023 likely driven by some Australian exporters anticipating the removal of import tariffs in mainland China in early 2024.

A decline in unpackaged wine exports to the United States after a period of heightened exports further contributed to the volume decline.

Exports to North America declined by 5 per cent to $482 million, driven by the United States, with growth in exports to Canada offsetting some of the decline.

The top five destinations by value were: China (up $898 million to $907 million); UK (down $9 million to $352 million); US (down $38 million to $325 million); Hong Kong (down $125 million to $171 million) and Canada (up $13 million to $156 million).

For more information, see Wine Australia’s Export Report.

Image: Marco Simola, Scop.io  

Australia making more white wine than red

Total sales of Australian wine exceeded production for the second year in a row, but there is still a lot of red wine in tanks waiting for a home.

The good news followed successive small vintages, says the Australian Wine Production, Sales and Inventory Report 2024 released today by Wine Australia.

Wine production was just over 1 billion litres, an 8% increase compared with 2022–23 but still the second-smallest reported production in 17 years, and 16% below the 10-year average of 1.24 billion litres.

Peter Bailey, manager for market insights at Wine Australia, said that the below-average production from the small 2024 vintage was the result of a combination of seasonal factors and economic and market conditions.

“This was another difficult season in many regions, with heavy rainfall and flooding, widespread windy conditions affecting flowering, and dry spring weather leading to cold nights and the potential for frost damage,” Bailey said.

“However, the result has also stemmed from deliberate decisions by grape growers and wine businesses to reduce production or intake, driven by the current economic and market conditions affecting demand for wine.”

The overall increase of 8% cent compared with 2022–23 was made up of a 20% increase in white wine production, partly offset by a 2% decrease in red wine production.

This saw white wine’s share of production increase from 46% to 51% - the first time in 12 years that the production of white wine has exceeded that of red wine in Australia.

Bailey said that this change reflected adjustments made by the sector to counter the oversupply of red wine that had arisen over the past three years.

The total volume of sales of Australian wine in export and domestic markets was 1.08 billion litres - a decrease of 1% compared with 2022–23, with both domestic and export sales showing very small declines.

Bailey said growth in red wine exports was driven by the re-commencement of exports to mainland China following the removal of import tariffs in late March 2024.

“It will take some time before there is a clearer picture of how Chinese consumers are responding to the increased availability of Australian wine in–market,” Bailey said.

“Any increase in production is likely to result in stock levels rising again, unless there is a corresponding increase in sales. This is a particular concern for reds, where the stock-to-sales ratio is still well above the long-term average.”

Bailey noted that the global outlook for Australian wine remains challenging. 

World wine consumption has continued to decline over the past 12 months and is expected to decline further in the next five years, driven by economic constraints, overall alcohol moderation trends and competition for wine from other beverages.

Image: Elena Pasenko, Scop.io 

The new plan to rescue the Australian wine industry

A new plan to help lift the wine industry in Australia was unveiled today in Adelaide.

Australian Grape & Wine and Wine Australia have launched the One Grape & Wine Sector Plan at the Wine Industry Update 2024 conference.

Developed to support the sector’s recovery from a period of ongoing challenges, the One Grape & Wine Sector Plan aims to chart a clear path of action and to reflects "the sector’s resilience and commitment to forge a vibrant and prosperous future".

The Plan provides the framework for collaborative and co-ordinated action for the sector, as well as a roadmap for achieving the sector's goals and vision articulated in Vision 2050.

Australian Grape & Wine Chief Executive Officer Lee McLean said the Plan’s development is the result of extensive consultation across the entire sector.

“Grapegrowers, winemakers, exporters, industry associations, researchers, business and suppliers have shared their views, insights, aspirations, concerns and expectations on the challenges and opportunities for the sector,” McLean said.

“As a result, the Plan launched today, provides greater linkages to existing plans, such as Vision 2050, demonstrates stronger industry leadership, collaboration and coordination, and provides practical action and guidance for all.”

The Plan provides the framework for collaboration and coordination among all sector players to achieve the ambitious goals outlined in Vision 2050. Six key themes shape the roadmap for sector success:Our place and product: consumers, customers and community; markets, sustainability, people, systems and infrastructure.

“The breadth of the Australian grape and wine sector is its strength; from family-owned grapegrowers, commercial and premium winemakers, to vertically integrated businesses and corporates," says Wine Australia Chief Executive Officer Dr Martin Cole.

"The strength of the Plan lies in our ability to share the load to optimise the opportunities ahead..

“But success is dependent on action: collaboration and shared responsibility, to learn from the past, acting on the challenges of today, to set the course for sector success."

The One Grape & Wine Sector Plan can be downloaded from agw.org.au or wineaustralia.com.

Image: Emanuele Lattarulo, Scop.io 

Finally some good news for Australian wine producers

At last there is some good news for the Australian wine industry.

Australian wine exports increased in value by 17% to $2.2 billion in 2023–24, the highest level since the 12 months ended September 2021, Wine Australia’s Export Report released today reveals.

The growth in value was due to a surge in exports to mainland China in the last three months of the financial year, as Australian wine re-stocked supply pipelines following the removal of the duties on Australian bottled wine in China in late March.

But Wine Australia manager for market Insights, Peter Bailey, said that the rise in exports to mainland China is still a small fraction of the historical peaks achieved to the market.

“The surge in exports to mainland China towards the end of the financial year saw volume rise from 1 million litres to 33 million litres and value grow by $392 million to $400 million compared to last financial year,” Bailey said.

“While the figures are very positive, they represent the re–stocking of Australian wine in the pipeline of a major market after a long absence and do not necessarily equate to retail sales. It will take some time before there is a clearer picture of how Chinese consumers are responding to the increased availability of Australian wine in-market.

“Consumption of both domestic and imported wines in mainland China is less than a third of what it was six years ago and thus it is very unlikely that Australian wine exports will return to those previous peaks in the short to medium term.”

There were 574 companies exporting to mainland China in 2023–24, up from 115 in 2022–23. Prior to the imposition of duties, there were more than 2,000 companies exporting to China.

“The growth in value has seen mainland China return to the top export market by value,” Bailey said.

“However, the volume of exports at 33 million litres, is relatively small, equating to less than 5% of Australia’s wine grape harvest in 2024 and so is unlikely to make a significant impact on the current oversupply of red wine grapes, particularly in the big volume-producing warm inland regions.”

Exports to the rest of the world (excluding mainland China) declined by 4% ($68 million) to $1.8 billion and volume decreased by 5% (33 million litres) to 587 million litres.

This is the lowest volume exported to the rest of the world in a financial year since 2003–04.

“Global trading conditions remain very challenging with wine consumption continuing to fall in many markets around the world due to moderation trends and cost of living pressures," Bailey said.

"There are also enduring problems in shipping, with a shortage of ships globally and freight and charter rates on the rise.”

So the news is decidedly mixed.

But Australia is not the only country negatively impacted by these factors. Wine exports have also declined from other major wine producing countries.

In the 12 months ended April 2024, the volume of wine exported from Spain fell by 2%, France by 7%, Chile by 7%, South Africa by 12% and New Zealand by 14%.

Wine industry looks to boost gender equality/diversity

The Australian wine industry is launching a new survey to investigate the state of gender equality, and to identify strengths, weaknesses, and opportunities for progress in the grape and wine sector.

The collaborative effort is being run by Australian Grape & Wine’s Diversity, Equality and Inclusion in Wine (DEIW) committee and is funded by Wine Australia.

Research will be undertaken by Charles Sturt University and the University of New South Wales.

The research team will engage wine and grape sector stakeholders to identify recommendations and develop a practical toolkit for businesses and sector organisations, translating best practices and innovative ideas for gender equality, into actionable steps.

There's a whole lot of politically correct jargon in that one sentence, but hopefully the sentiment is serious.

Wine Australia Chief Executive Officer Martin Cole said the study will help the sector tap the depth of diversity across the breadth of the sector’s value chain. Yikes.

“Achieving long-term sector profitability, resilience and sustainability means we must have the best people at the table," Cole said. "A vibrant future demands we look to broaden the expertise, experience and perspectives of those at decision-making tables across the value chain.

Gender equality and diversity were identified by the sector as a priority through recent consultation for the One Grape & Wine Sector Plan.

“This research project will build on efforts made by the sector in recent years, recognising the need to progress these, providing evidence-based support for ongoing improvement,” Cole said.

“Our goal is to equip the sector with practical resources to be more inclusive, fostering equality and diversity to strengthen business and sector performance.”

Australian Grape & Wine DEIW committee chair Ali Laslett said the grape and wine sector was a significant employer in regional areas and had shown commitment to increasing gender equality.

“Promoting gender equality aligns with the strategic priorities of many primary industries," she said.

"The DEIW committee identified several initiatives in our workplan, and we are delighted that our recommendation to provide practical resources for all businesses within the sector will be realised through this project.

"Our sector’s future success is built on practices that support and retain a diverse workforce.”

White heat: Major wine industry player has its export licence cancelled

A major player in the Australian wine industry has had its export licence cancelled.

Wine Australia today announced it has cancelled the export rights held by Jindalee Road Wines Pty Ltd, an entity operating out of the New South Wales Murray Darling region.

Jindalee Road says on its website that it is a specialist in the growth and production of white varieties and the biggest sauvignon blanc and pinot grigio grower in Australia.

Jindalee Road does not own a label but specialises in bulk sales to other wine producers.

Wine Australia’s Label Integrity Program investigation found that Jindalee Road Wines had failed to meet its record-keeping obligations established by the Wine Australia Act 2013.

Wine cannot be exported from Australia without an export licence issued by Wine Australia.

There are no concerns about health or safety for consumers of the wine, Wine Australia said. "However, wine label claims in relation to vintage, variety and region strongly influence people’s purchasing decisions.

"The licence cancellation reflects Wine Australia’s commitment to ensuring that consumers worldwide can be confident that label claims reflect what is in the bottle."

Jindalee Road Wines may make an application to the Administrative Appeals Tribunal for review of the decision to cancel its export licence in accordance with the Administrative Appeals Tribunal Act 1975.

Wine Australia was not able to comment further as the matter is subject to an ongoing investigation.

It is not the first time the wine entity has found itself in trouble.

Jindalee Road Wines and its ex-manager David Littore were in March fined $500,000 for stealing irrigation water.

Wine Australia says, however, that there is generally a strong culture of compliance in the Australian grape and wine sector. Wine Australia has only suspended or cancelled eight licences in the past 10 years, including Jindalee Road Wines. There are more than 2000 active licence holders.

More information on the Label Integrity Program can be found at www.wineaustralia.com/labelling