Wine Australia report says exports have hit 22-year low as drinkers sober up, loses $180 million

Australia’s wine producers have copped a more than $180 million hit to exports as global consumption falls to its lowest level in almost seven decades in yet another sign that drinkers are increasingly sobering up.

Wine exports plunged 7.4 per cent — or $183.6m — in value to $2.3 billion in the year to the end of June, as volume slumped 6 per cent to 598 million litres.

It’s the first time export volume has fallen below 600 million litres since 2004, according to a new report from industry body Wine Australia on Wednesday.

Wine Australia said the decline mirrored a broader global trend of declining wine consumption over the past decade.

It said worldwide wine consumption had fallen to its lowest level since 1961 “as consumers increasingly moderate alcohol intake, face cost-of-living pressures and shift towards alternative beverages”.

Wine Australia market insights manager Peter Bailey said the challenges facing Australian exporters were not unique, with other wine-producing nations facing the same conditions.

“Data from multiple sources suggests the decline in wine consumption globally is more than a short-term downturn — it’s a reflection of changing consumer behaviour that is reshaping demand around the world,” he said.

“This reinforces the importance of understanding where demand exists and the products and occasions that are driving consumer decisions.”

Mainland China remained Australia’s biggest export market by value, despite exports falling 15 per cent to $756m as the initial post-tariff recovery and restocking phase came to an end.

The UK and US remained Australia’s biggest market by volume, though both fell to their lowest level in 25 years.

But several markets delivered strong growth despite the broader slowdown, Wine Australia said.

“Canada was a standout performer, with export value increasing 20 per cent to $188m — its highest level in seven years — and volume rising 13 per cent,” Mr Bailey said.

“Asian markets outside mainland China also delivered strong growth. Export value increased significantly in Singapore, Thailand, Malaysia, Japan, South Korea and Taiwan.”

Red wine is Australia’s best export. Shiraz is the top variety for exports at 155 million litres for the year, down 8 per cent.

Chardonnay is the top-selling white wine, but was still down 12 per cent to 122 million litres.

In June, Australia’s top wine producer Treasury Wine Estates revealed it would reduce its portfolio from 76 to 30 brands across multiple markets over the next five years.

Dan Murphy’s and BWS owner Endeavour Group has also announced it would sell most of its vineyard portfolio as part of a three-year cost-reduction program that is targeting $300m in savings.