Export data suggests positive sales path ahead: “overall declines have stabilised”

Australian wine exports declined by 1 percent in value to $1.88 billion and 2 percent in volume to 611 million litres in the 12 months to March 2024, according to Wine Australia’s Export Report released today.

The latest figures reflect a relatively stable period for Australian wine’s overall export performance in recent times.

*Figure 1: Volume and value of Australian wine exports. Image courtesy Wine Australia*

Wine Australia Manager, Market Insights, Peter Bailey said that over the past 12 months, growth in some markets in Asia and Europe has been offset by a decline in exports to North America and, to a lesser extent, other destinations in Asia.

“The largest drivers of value growth in the past 12 months were Hong Kong, New Zealand, and the UK, while exports to Canada, the US, Singapore, South Korea, Indonesia, and Malaysia declined,” Bailey said.

“While we expect volatility to continue at an individual market level, data from recent quarters suggest that overall declines have stabilised, and a more positive sales trajectory is ahead.

“Asia was the largest region by value for Australian wine exports, with a 36% value share. Strong growth in Northeast Asia – driven by Hong Kong – was tempered by a decline in the value of exports to Southeast Asia – driven by Singapore, Indonesia, and Malaysia – during the period.”

*Figure 2: Export value by destination region in 2024. Image courtesy Wine Australia*

Australian wine exports to Northeast Asia increased by 29% in value to $412 million.

“The vast majority of the growth in Northeast Asia’s value was driven by exports to Hong Kong, which increased by 60% to $290 million, mainly in red wine above $10 per litre FOB. Hong Kong is a major trading hub and therefore some of the wine may be on-shipped to other Asian markets,” said Bailey.

“Exports to Japan also grew during the period – up 4% in value to $48 million – mainly driven by exports valued between $2.50 and $4.99 per litre, but also above $10 per litre FOB.”

Mainland China experienced an uplift in the reporting period, growing 21% to $13 million but off a low base. As the announcement by China’s Ministry of Commerce on the removal of the import duties imposed on Australian wine was made in late March, it has had little impact on the annual data in this report.

Notably, for the month of March 2024, exports to mainland China were up 240% in value at $2.9 million, compared to the same time last year. This is in contrast to the figures for February 2024 which saw the total value of exports to China at $1.2 million.

Exports to Hong Kong, which reached a total value of $99 million in December 2023 (an increase of 315% on the previous year) following China’s commitment to review its tariff decision, have since fallen to $7.5 million in the month of March 2024.

In the United Kingdom (UK), Australian wine export performance has been positive in the past 12 months.

“The increasing value and volume of exports to the UK was likely being driven by an increase in customers opting to drink wine at home rather than in bars and restaurants, to save money during the cost-of-living crisis. Australia has a 24% share of all off-premise wine sales in the UK and is the number one country of origin in the category, so it benefits when consumers move towards this channel away from the on-premise,” Bailey said.

The decline in exports to the United States (US) was entirely driven by unpackaged wine.

“During 2022 and the early part of 2023, unpackaged wine exports to the US surged as shipping conditions improved and Australian producers were able to ship large inventories into market. This trend has now eased, and total exports have declined as a result. Meanwhile, in Canada, the decline is driven by a continued decline in packaged exports, while the growth in unpackaged exports has also eased,” Bailey said.

The top five markets by value were: