In 2023–24, Australian wine exports increased in value by 17 per cent to $2.2 billion[1], the highest level since the 12 months ended September 2021. Volume declined by 0.2 per cent to 619 million litres while the average value increased by 18 per cent to $3.53 per litre free on board (FOB)[2]. The number of destinations that Australian wine was shipped to fell slightly, from 117 to 115.
The growth in value was due to a surge in exports to mainland China. Exports to mainland China grew by $392 million to reach $400 million in 2023–24 (see Figure 1). Volume grew from 1 million litres to 33 million litres. The growth to mainland China came in the last three months of the financial year, following the removal of the duties on Australian bottled wine in late March 2024.
In comparison, the value of exports to the rest of the world (excluding mainland China) declined by 4 per cent ($68 million) to $1.8 billion and volume decreased by 5 per cent (33 million litres) to 587 million litres. This is the lowest volume exported to the rest of the world in a financial year since 2003–04. The decline in volume was most significant in unpackaged exports priced under $1.50 per litre to the United States (US) and Canada (down a combined 20 million litres).
Global trading conditions remain very challenging with wine consumption continuing to fall in many markets around the world due to moderation trends related to health and wellness concerns and compounded by cost of living pressures. There are also enduring problems in shipping, with a shortage of ships globally and freight and charter rates on the rise.
Australia is not the only country negatively impacted by these factors. Wine exports have also declined from other major wine producing countries. For example, in the 12 months ended April 2024, the volume of wine exported from Spain fell by 2 per cent, France by 7 per cent, Chile by 7 per cent, South Africa by 12 per cent, Germany by 5 per cent and New Zealand by 14 per cent.
Figure 1: Value of Australian exports by destination
The top five destinations by value were:
- Mainland China (up $392 million to $400 million)
- US (down $2 million to $357 million)
- UK (down $11 million to $353 million)
- Hong Kong (up $55 million to $275 million), and
- Canada (down $17 million to $146 million).
The top five destinations by volume were:
- UK (down 3 million litres to 217 million litres)
- US (down 11 million litres to 124 million litres)
- Canada (down 8 million litres to 68 million litres)
- Mainland China (up 31 million litres to 33 million litres), and
- New Zealand (down 3 million litres to 28 million litres).
Mainland China
On 29 March 2024, the duties on Australian bottled wine exports to mainland China were removed. Since that time, there has been a significant uplift in Australian wine exports to the market. Between April and June 2024, 31 million litres of wine valued at $389 million were exported to mainland China. This resulted in Australian wine exports to the destination increasing from 1 million litres valued at $8 million in 2022–23 to 33 million litres valued at $400 million in 2023–24. Wines priced at $20 or more litre were the main driver of the value growth and led to the average value of exports to mainland China increasing year-on-year from $7.90 per litre to $12.31 per litre.
Despite this strong growth, Figure 2 illustrates that the current level of Australian wine exports to mainland China is still a small fraction of the historical peaks achieved to the market in volume (176 million litres in the 12 months ended July 2018) and value ($1.2 billion in the 12 months ended October 2020).
It is also important to note that the consumption of both domestic and imported wines in mainland China are less than a third of what they were six years ago and thus it is very unlikely that Australian wine exports will return to those previous peaks in the short- to medium-term. IWSR reports that in the six years from 2017 to 2023, consumption of Chinese domestic wine fell from 95 million cases to 27 million cases while sales of imported wines fell from 61 million cases to just under 20 million cases.
Figure 2: Exports of Australian wine to mainland China over time
There were 574 companies exporting to mainland China in 2023–24, up from 115 in 2022–23. Of these, 523 commenced exporting in the current year. The top ten exporters by value to the market contributed three-quarters of the total value and 39 per cent of the volume. Prior to the imposition duties, there were more than 2,000 companies exporting to mainland China.
In 2023–24, bottled exports accounted for 94 per cent of the value exported to mainland China but the volume share was much lower at 39 per cent. In contrast unpackaged exports contributed 6 per cent of the value and 61 per cent of the volume.
There was growth across all price segments but differences in the impact on the overall results by volume and value (see Figure 3).
Figure 3: Australian exports to mainland China by price segment
By value, 84 per cent of the growth came at the wines priced at $20 or more per litre FOB, which roughly translates to 300 RMB per bottle retail. Exports to mainland China in this segment grew from $3 million in 2022–23 to $333 million in 2023–24. Volume in this segment grew from 64,000 litres to just over 5 million litres, a 17 per cent volume share. In contrast, the volume of exports less than $2.50 per litre, which is shipped unpackaged, grew from 406,000 litres to 19 million litres (a 59 per cent volume share) and value from $530,000 to $15 million.
Still red wine accounted for 99 per cent of the value growth to mainland China. Within the red category, 73 per cent of the growth came in Shiraz and Cabernet Sauvignon. Shiraz exports grew from 620,000 litres to 17 million litres and value from $4 million to $157 million. Exports of Cabernet Sauvignon grew from 181,000 litres to 7 million litres and value from $2 million to $132 million.
While the export figures to mainland China are very positive, they represent the re-stocking of Australian wine in the pipeline of a major market after a long absence. They do not necessarily equate to retail sales, and it will take some time before there is a clearer picture of how Chinese consumers are responding to the increased availability of Australian wine in-market. The volume of exports to mainland China is also relatively small – equating to around 47,000 tonnes of grapes out of a total harvest of 1.4 million tonnes in 2024 (less than five per cent). This volume is unlikely to make a significant impact on Australia’s current oversupply of red winegrapes, particularly in the big volume-producing warm inland regions.
United States of America
Exports to the US declined by 8 per cent (11 million litres) in volume to 124 million litres and in value by 1 per cent ($2 million) to $357 million, the lowest levels in 25 years. However, there are some signs of recovery as value was up 1 per cent for the April to June quarter.
The biggest impact on the overall decline in exports to the US over the past 12 months was in unpackaged exports priced at under $1.50 per litre. Volume declined by 19 per cent (14 million litres) to 57 million litres and value also by 19 per cent ($15 million) to $65 million.
Bottled exports were in growth. Volume increased by 8 per cent to 63 million litres and value by 7 per cent to $285 million.
Exports at the higher end of the price spectrum declined. The bright spot for the US was in exports priced at $2.50 to $4.99 per litre. Volume increased by 11 per cent (6 million litres) to 59 million litres and value by 15 per cent ($30 million) to $234 million. White wine contributed 53 per cent of the value growth, red wine 46 per cent and sparkling wine 1 per cent.
While white wine exports declined by 9 per cent in volume to 71 million litres, value increased by 1 per cent to $179 million. Chardonnay was the number white variety exported to the US and exports were up by 1 per cent to $109 million. The strongest performing white variety was Pinot Gris/Grigio with value up 26 per cent to $47 million, becoming the second biggest white variety exported to the US.
Red wine exports fell in both volume and value. Volume declined by 7 per cent to 50 million litres and value by 2 per cent to $166 million. Cabernet Sauvignon was the number one red variety exported to the US and was also the strongest performing red category with volume up 22 per cent to 22 million litres and value up 4 per cent to $57 million. Shiraz fell to second place in red wine exports as volume declined by 45 per cent to 8 million litres and value by 17 per cent to $47 million.
Australia’s export performance in the US partly reflects the current state of the US wine market. The alcohol moderation trend, which is particularly evident among younger consumers, is leading to lower drinking frequency levels and volumes across the board. Economic pressures also remain prevalent and are pushing many to prioritise spending on essentials over wine. IWSR data shows that wine sales in the US have fallen for three consecutive calendar years, with volumes sold down 10 per cent from 367 million cases in 2020 to 330 million cases in 2023. It is expected to fall by a further 22 million cases (7 per cent) by 2028.
United Kingdom
The UK remains the biggest destination for Australian wine exports, by volume despite exports declining by 1 per cent to 217 million litres. Value also declined, down 3 per cent to $353 million, the lowest level since 2016–17. The UK is ranked third in export value behind mainland China and the US. The lower value rank is primarily due to 90 per cent of exports to the UK being sent there unpackaged and then packaged in-market.
The decline in exports to the UK was due to a reduction in bottled exports which more than offset an increase in unpackaged exports. The volume of bottled exports declined by 13 per cent to 21 million litres and value declined by 11 per cent to $115 million. The biggest decline in bottled exports was in still red wine, down 14 per cent in value to $64 million while white wine exports declined by 8 per cent to $44 million. On the positive side, sparkling bottled exports increased by 15 per cent to $5 million, with the average value increasing by 30 per cent to $7.50 per litre – the highest financial year value recorded.
The volume of unpackaged exports to the UK increased by 0.2 per cent to 196 million litres and in value by 1 per cent to $237 million. Unpackaged still white wine exports declined by 2 per cent in volume to 86 million litres but value increased by 3 per cent to $102 million on the back of a 5 per cent increase in average value to $1.19 per litre. In contrast, the volume of unpackaged red wine exports increased by 1 per cent to 105 million litres but value decreased by 0.2 per cent to $128 million as the average value dropped by 2 per cent to $1.22 per litre.
Like other mature wine markets such as the US and Canada, the moderation trends and cost-of-living pressures are also impacting on the UK wine market. IWSR reports that wine sales in the UK have fallen from 134 million cases in 2020 to 118 million cases in 2023. While all price points have declined since 2020, the decline is far more pronounced at the commercial/value end (less than US$9.50 or more per bottle), with volume down 14 per cent to 90 million cases in 2023 vs 2022, compared to a 4 per cent decline at the premium and above segments to 28 million cases.
Data from Circana for the 12 months ended June 2024 shows that in the UK off–trade, Australian wine remains a clear market leader with a 23 per cent value share ahead of Italian wine with 13 per cent, France with 11 per cent and Chile with 10 per cent.
Other destinations
Within the Asian region, exports fell to Singapore fell for the second successive financial year, down 28 per cent in volume to 6 million litres and 23 per cent in value to $99 million. In contrast, exports increased to Thailand for the fourth successive year to reach a record financial year high, up 7 per cent in volume to 7 million litres and 1 per cent in value to $58 million.
Within the Americas, exports to Canada fell in value for the sixth consecutive year, down 11 per cent to $146 million in 2023–24. Volume also fell by 11 per cent to 68 million litres, after very strong growth in 2022–23. It is still the second-highest volume of exports to Canada since 2017–18. Value is now at the lowest financial year level since 2001–02.
There were mixed results for other European destinations. The markets that recorded increased exports in volume and value included Sweden, Belgium and Switzerland. The Netherlands and Ireland saw reduced volumes but increased value. Markets where both the volume and value declined included Denmark, Germany, France, Finland, Norway and Poland.
New Zealand and the United Arab Emirates (UAE) are the biggest destinations outside of Asia, North America and Europe for Australian wine exports, together accounting for 5 per cent of exports by volume in 2023–24.
Exports to New Zealand declined in volume by 11 per cent to 28 million litres and value by 4 per cent to $99 million. There were mixed results by wine style. Sparkling wine exports to New Zealand increased while red and white wine exports declined.
Exports to the UAE increased by 19 per cent in volume to 3 million litres and 15 per cent in value to $18 million. Red wine was the key driver in the growth to the UAE.
View the Export Report here. Wine Australia’s Export Report data is available to filter and customise (including by export destination and the wine’s origin state) here.
1. Unless otherwise stated all values are given in Australian dollars.
2. All export wine values are the ‘Free on board' (FOB) value of the wine, where the point of valuation is where goods are placed on board the international carrier, at the border of the exporting country. The FOB value includes production and other costs up until placement on the international carrier but excludes international insurance and transport costs.