The Australian wine industry is experiencing stock concerns after overall sales of Australian wine outpaced production for the second year in a row, following a string of short vintages.
According to the Australian Wine Production, Sales, and Inventory Report 2024, wine production was just more than 1 billion litres, up 8 per cent from the previous year but still the second-lowest reported production in 17 years, and 16 per cent lower than the 10-year average of 1.24 billion litres.
According to Peter Bailey, manager of Market Insights at Wine Australia, the small 2024 vintage’s below-average production was due to a mix of seasonal factors as well as economic and market conditions.
“This was another difficult season in many regions, with heavy rainfall and flooding, widespread windy conditions affecting flowering, and dry spring weather leading to cold nights and the potential for frost damage,” Bailey added.
Bailey believes the worldwide picture for Australian wine remains tough. World wine consumption has been down for the past year and is predicted to continue to fall in the coming five years, owing to economic restrictions, overall alcohol moderation tendencies, and competition from alternative beverages.
However, red stocks remain high. Bailey explained that the increase in red wine exports was driven by the resumption of exports to mainland China following the elimination of import duties in late March.
“Any increase in production is likely to result in stock levels rising again unless there is a corresponding increase in sales. This is a particular concern for reds, where the stock-to-sales ratio is still well above the long-term average,” he said.
