Australian Wine Exports

Wine Exports

The 2018-19 financial year saw Australian wine exports grow modestly by 4% to $2.86 billion despite a decrease of 6% in volume to 801 million litres (Tables 9 and 10). Overall, $106 million in revenue was generated by Australian wine exporters which is an increase from the 2017-18 financial year in spite of the modest growth rate. The average value of exports grew by 10% to $3.58 per litre free on board (FOB). This continued an upward trend for the third year running (Table 10).

Wine in the price category below $10 per litre accounted for 66% of the total volume of Australian wine exported, a small decline of 1%, which translated to a decline of $21 million in value for the 2018 fiscal year (Table 9). The largest declines were in the $50-$99.99 and $200+ ranges, dropping by 17% and 14% respectively, and contributing to a loss of $47 million in terms of export value. Good news abounded elsewhere with enormous growth in both lowerand higher-end price categories. In particular, the $10-$14.99, $20-$29.99 and $100-$199.99 categories soared by 25%, 46% and a substantial 102% respectively. These increases indicated a growing preference for premium wine while injecting an additional $152 million into the industry.

Global demand for Australian wines shows no signs of waning with wine exports continuing to experience strong growth in both value and volume terms. Overall, Australia is still experiencing a high export value growth rate. Exports to China dropped by 17% in volume, but overall value has increased by 8% to $1.1 billion. Thailand is a quickly emerging market with an increase of 70% in
export volume and an associated growth in value by $28 million, representing a 57% rise from 2018. Denmark is also showing signs of moderate growth with a 20% increase in export volume, generating $24.9 million in exports, a rise of 14%. Exports to China still provide the largest value to the Australian wine sector with China paying an average $7.45 per litre, up by a significant 30% from the previous year (Table 11). Hong Kong is also showing a thirst for Australian wines, with a 4% increase in the amount paid, to an average of $14.12 per litre.

Exports to the UK decreased slightly by 3%, countering an increase in 2018. However, the UK is still Australia’s largest export market in terms of volume, with 236.2ML shipped in 2019, much of this stockpiled in the market ahead of Brexit uncertainty.

All five of Australia’s largest international markets exhibited a decline in growth over 2019 in terms of the volume of wine exported, although, as noted earlier, China showed growth in the value per litre of Australian wines imported.

The United States is the largest consumer market for wine in the world and it remained the second largest importer of Australian wines by both volume and value in 2019. There was a slower rate of decline in the volume at 4%, compared to 11% 2018, with a drop to 152.5ML from the previous year. However, thanks to a 6% increase in the average value per litre, there was a rise to a total of
$432 million in exports to the US in 2019 (Table 11). The decline in the export volume of Australian wine to the US was attributed to factors including a smaller Australian vintage, improving international supply and a preference for premium wines consumed at higher prices (Wine Australia Market Bulletin, Issue 166).

Exports shipped in bulk totalled 429ML equalling $521 million (Table 12). There was a reduction by 13% for bulk red wine exported, but there was an overall increase of 3% in value. Bulk white wine experienced a modest increase of 2% in volume and a 9% increase in value, to $210 million (Table 12).

The volume of exported fermented sparkling wine declined in 2019 by 5% to 7ML. This was the first drop for this category since 2017. However, due to a 16% increase in average value per litre, fermented sparkling wine enjoyed a 10% increase in total value to $48m (Table 12).

Once again, red bottled wine exports remained the largest by volume and value for export category. In the 2019 financial year, a total of 244ML were shipped for a value of $1.8 billion, reflecting annual growth in value of 4%. Wine producers can expect an average of $7.49 per litre for glass bottled red, still the highest price for the export market, exhibiting an increase of 11% from 2018. Glass bottled white wines showed a decrease of 5% in volume, with 92ML exported, earning $382 million for exporters, a total amount up 2% from 2018 (Table 12).

Rosé also demonstrated strong growth in exports in 2019 (Table 12). Glass bottled exports totalled 6ML corresponding to a total of $30 million, an increase of 13% from the previous year. Bulk rosé exports grew by by 32% in value to a total of $11 million.

Treasury Wine Estates claimed top ranking as the largest Australian wine company in terms of both export volume and value (Tables 15 and 16). The top five exporting wine companies by volume remain unchanged from previous years (Tables 15 and 16).



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