Australian wine across the Tasman
Market Bulletin | Issue 38
This week’s market update looks at our nearest neighbour and sixth largest wine market: New Zealand.
We know that New Zealand is a tough competitor in the world wine market – particularly when it comes to Sauvignon Blanc. But did you know that Australia has a larger share of New Zealand’s wine consumption than New Zealand has of ours?
New Zealand is a very significant wine market for Australia and one of our most loyal customers.
Australia is the number one importer of wine into New Zealand by a very comfortable margin, with 48 per cent of the imported wine by value. Even in the sparkling wine category, where France is usually the largest, Australia is the number one source of imports.
Our exports of wine to New Zealand grew by 3 per cent in value and 13 per cent in volume for 12 months ended September 2016, with most of that growth being in white varieties.
While New Zealand is a small market with a population of just 4.5 million people, Wine Intelligence estimates that 1.9 million people – or 42 per cent of the population – are regular wine drinkers.
Per capita consumption is relatively high at 23.8 litres per annum, and it is estimated to grow to 26 litres per capita by 2020 according to Euromonitor. This projection is higher than those for Australia (23.9), the UK (20.9) or the US (9.8) for 2020.
Driving consumption higher is a shift towards lower alcohol wines that sit better with health-conscious consumers. Organic and bio-dynamic wines are also selling well.
New Zealand has a very healthy economy that has been growing steadily for some years, with 2 per cent growth in 2015 according to the IMF.
According to Euromonitor, the value of the New Zealand wine market is expected to grow by an average of 3.3 per cent per annum for the next four years – a higher rate of growth than for Australia (2.6 per cent), the UK (0.4 per cent) or the US (2.1 per cent).
White wine is more popular than red wine in the New Zealand domestic market, with the top five varieties being Sauvignon Blanc, Pinot Gris, Chardonnay, Riesling and Moscato (Wine Intelligence, 2016). In the reds, Pinot Noir, Merlot and Cabernet Sauvignon are the top three, with Shiraz fourth.