07 Dec Australian Wine Industry Pivots In Face of Latest Trends
Whilst the Australian wine industry has grown, producing 1.3 billion litres in 2022, with more than 2,000 wineries employing 164,000 people and contributing AU$40 billion annually to the economy*, it has also simultaneously seen exports decrease by 10%, to AU$1.86 billion in the year to June 2023, reaching its lowest level since 2014.
Whilst most of the export drop was due to wine tariff imposed by China, the reality is that even upon the lifting of the tariff, the wine industry is facing a substantially altered playing field.
Although China will eventually become a major market again, this process will take time and entail overcoming challenges such as changed Chinese consumer preferences and the fact that they are also drinking less wine, with consumption decreasing by 16% in 2022.
According to a recent report by Rabobank, even if the China wine tariffs were removed overnight and exports resumed, it would still take Australia’s wine industry at least two years to work through its current surplus, which amounts to the equivalent of 2.8 billion bottles of wine.
In addition, there is a global trend towards more upmarket wines from commercial wines, which is reflective of the Australian landscape that saw the premium wine market grow by 17% whilst the commercial wine segment fell by 13%.
Various contributing factors such as China’s punitive tariffs, weather events impacting winery areas and yields, as well as changing consumer preferences has seen major industry players review their business models and undertake measures such as major restructuring of wine portfolios, strategic operational reviews, winery closures and more.
FOLLOW US FOR THE LATEST NEWS!
Simply click here to follow our LinkedIn Company Page to stay up-to-date with the latest industry news that may impact your business.
*source: Wine Australia
Sorry, the comment form is closed at this time.