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Australian wine exports decreased by 26 per cent in value to $2.05 billion and 13 per cent in volume to 628 million litres in the year ended March 2022.

Wine Australia said the results of its latest Export Report reflect the impact of the imposition of high deposit tariffs on bottled Australian wine imported to mainland China in November 2020 and exceptionally tough market conditions globally.

Exports excluding mainland China declined by 3 per cent in volume but increased by 7 per cent in value to $2.03 billion – the highest value since 2010.

Key drivers of the value growth were in markets including Singapore, Hong Kong, Thailand, South Korea, Taiwan and Japan indicating that market intensification and diversification is having an impact.

In the 12 months ended March 2022, Australian exporters shipped wine to 112 markets and 71 experienced value growth.

Wine Australia General Manager Corporate Affairs and Regulation Rachel Triggs said while the increase in value excluding mainland China was strong at $129 million, it did not come close to offsetting the decline in value to mainland China (a loss of $844 million).

“Over the past 15 months, Australian wine exporters have had to navigate through an exceptionally challenging operating environment, largely led by the imposition of high deposit tariffs on bottled Australian wine imported to mainland China, the continuing impact of the global freight crisis, and a counter-swing in some markets after COVID-19 related stockpiling in 2020,” she said.

“What the latest Export Report shows is that efforts to diversify and intensify markets is slowly reaping rewards for Australian wine exporters. With the easing of COVID-19 restrictions, we’re seeing the on-premise trade open up in established markets and that has had an impact as demand stabilises.”

The decline in total wine export volume, excluding mainland China, was most significant to Australia’s two biggest markets of the United Kingdom (UK) and the United States of America (US). Exports to these markets surged during 2020 due to COVID-19 stockpiling for the off-premise trade, but demand has since eased as pandemic restrictions relaxed.

“Low inventory after three small consecutive vintages and delays in getting the record 2021 vintage onto ships from the ongoing global freight crisis also contributed to the decline in volume of wine exports. Shipping industry experts to do not expect these issues to resolve until the second half of 2022 at the earliest,” Triggs said.

Australian wine exports declined in all price segments in the year ended March 2022, driven largely by the decline to mainland China and exports valued under $10 FOB per litre to the US and UK.

“However, when excluding mainland China, exports within the premium segment above $10 FOB per litre grew by 47 per cent, with 58 out of 89 destinations receiving exports in this price segment reporting growth during the year. These destinations included Singapore, Hong Kong, Thailand, the US, the UK, South Korea and Taiwan,” Triggs said.