Australian wine exports have decreased by 24 per cent in value to $2.27 billion and 17 per cent in volume to 638 million litres in the year ended September 2021.
Average value also declined by 9 per cent to $3.56 per litre free on board (FOB).
Wine Australia’s latest Export Report attributes the decline in exports to the significant decrease in exports to mainland China – down 77 per cent to $274 million with the number of exporters shipping to the market dropping from 2241 to 750 – and lower inventory levels from the small vintages of 2018-2020. Shipping delays have also impacted export volumes.
The record 2021 Australian vintage crush will start to impact export numbers over the next two quarters when shipping starts for the vintage, say Wine Australia.
Wine Australia’s General Manager – Corporate Affairs and Regulation, Rachel Triggs said the overall declines reflect the challenges that the Australian wine sector has faced over the past 12 months.
“The decline of exports that we’re seeing now was amplified by the fact that there was a large increase in exports in September and October 2020, driven by exporters shipping wine into mainland China ahead of tariffs being imposed, into the UK ahead of the Brexit transition conclusion, and a surge in demand for Australian wine in the UK and US during the COVID-19 pandemic,” Ms Triggs said.
“This front loading of exports led to the majority of 2020 vintage wines being shipped earlier than usual resulting in the lowest inventory levels in 10 years coming into the 2021 calendar year.”
Leaving mainland China aside, Australian wine exports increased by 9 per cent in value to $1.99 billion and decreased by 5 per cent in volume to 618 million litres.
Distributed to 113 markets, Australian wine experienced strong value growth in the United Kingdom (UK), Hong Kong, Singapore, South Korea, Denmark, Thailand and Taiwan.
“Over the past 18 months, there has been a significant increase in exports to the UK, which has led to the market solidifying its place as Australia’s number one destination by volume and it has now overtaken mainland China as the number one destination by value,” Ms Triggs said.
The numbers of wine exporters trading to the US increased and there are now 269 exporters active in the market – the highest since the Global Financial Crisis of 2009, say Wine Australia.
Furthermore, exports to the US with an average value above $10 per litre increased by 16 per cent in value to $43 million, most prominently in the $20 to $29.99 price segment.
“The growth in the above $10 per litre segment is a positive step as this price segment is key to ensuring Australian wine’s continued success in the US market. The premium price segments are driving growth of the broader wine category in the US,” Ms Triggs said.
Destinations
The top five markets by value were:
- UK, up 7 per cent to $460 million
- US, down 11 per cent to $393 million
- Mainland China, down 77 per cent to $274 million
- Hong Kong, up 135 per cent to $207 million, and
- Canada, down 12 per cent to $173 million.
The top five markets by volume were:
- UK, down 2 per cent to 251 million litres
- US, down 12 per cent to 123 million litres
- Canada, down 13 per cent to 49 million litres
- Germany, down 4 per cent to 33 million litres, and
- New Zealand, down 13 per cent to 28 million litres.
The most significant growth in export value came from shipments to Southeast Asia, up 43 per cent to $255 million, followed by Europe (including the UK) up 4 per cent to $703 million. This growth was offset by declining exports to Northeast Asia, down 56 per cent to $598 million, and North America, down 11 per cent to $567 million.
