Australian wine exports rise

Exports of Australian wine grew to nearly $3bn dollars over the last 12 months, the latest data from Wine Australia has shown, driven by the UK stocking up  in preparation for Brexit, and China.

Winemaking in Barossa (image: Wines of Australia)

The value growth, which topped $2.998bn showed the country’s highest level since 2007, with the average value of wine exports also rising 4% to $3.89per litre in the 12 months to September 2020. However volumes declined slightly by 0.4 % to 771mL (85.7m cases).

Wine Australia Chief Executive Officer Andreas Clark said the growth came despite the “unprecedented disruption” seen across international markets as a result of the global pandemic.

“Australian wine export volume has held reasonably steady and it is particularly pleasing to see both the overall value and the average value of exports growing during these challenging times,” he said.

The effect of the easing of Covid restrictions over the summer could be seen in the boost in exports during the fourth quarter (July to September), which rose 23% on last year, compared to declines of 7% in January-March and 4% in April-June. There was also a growing trend whereby there was strong growth at both the premium level and the more commercial, lower-priced ends in different markets. For example the UK and US tended to perform well with the lower priced wines, while there was growth of premium wines in China.

Unpackaged (bulk) wine shipments rose 13% in value to $576m, on volumes up 2% to 427mL, and the relative short supply saw prices rise to their highest level since 2004, up 10% to $1.35pL.

Top markets

Australia’s top five export markets all showed value growth, with mainland China showing exports up 4% to $1.17bn, on volumes down 12% to the equivalent of around 13.7m 9L case. The USA rose up 1% to $439m, making it the number two market, ahead of the UK.

Volumes in the US fell 4% to the equivalent of around 15.6 9L cases (141mL), although the average price per litre grew 5%. Growth was driven in the entry level ($2.50-4.99), which rose 9% and now accounts for $291m in value terms, as well as the $5-7.49 price bracket, which rose 5% to $24m.

However it was the UK which saw the largest growth, in impressive 18% taking value sales to $430m – its highest level since 2011. There was also double digit volume growth of 10% to around 256m L (equivalent to 28.4m 9L cases). Growth was mostly seen in the lower price bracket, below $5per Litre segment, which is shipped as bulk wine, for packaging in the UK for the UK and European market. Bulk wine accounts for around 85% of Australian wine to the UK. WInes of Australia noted that some companies were thought to be shipping products now in order to avoid potential disruption ahead of the Brexit deadline of 1 January 2021.

Canada and New Zealand also rose, up 4% and 9% respectively, and overall value exports to Europe rose 16% to $678m, over-taking North America for the first time since 2011.