BULK SHIPMENTS CONTINUE HURTING AUSTRALIAN WINES
Things aren’t looking up much in Australian wine country, according to the latest figures released by the Australian Wine and Brand Corp. for the month of October. While total exports were up slightly (0.7%) from last month’s small decline, exports to both the U.S. and Britain were down in terms of volume and value.
On top of that, an increasing amount of the export market is run by bulk shipments as opposed to branded bottles, which is not good news for companies like Foster's and McGuigan Simeon who are hoping to recover in 2007-2008 with "value-added" brands.
Australian wine-producers worry that the decline in sales might be a possible indicator that Australian wines are viewed as “cheap wine” in the eyes of the consumer in the U.K. and U.S. According to local news sources, nearly 80% of the volume being shipped abroad is at the lower end of the price range, $2.50-$4.99 segment, which is currently losing share in the U.S. market.
Wine exports from Australia grew 6% in the twelve months to October, but the average price per liter dropped 8%.
"This was an expected result, given the continued growth in bulk wine shipments in response to the current oversupply of wine," said the Australian Wine and Brandy Corp.’s information and analysis manager, Lawrie Stanford, to The Age.
The United Kingdom (265m liters) and United States (211m liters) remained Australia's largest export markets, followed by Canada (53m liters), Germany (35m liters) and New Zealand (30m liters).
Australia exported some $927 million worth of wine to the UK, with exports to the US valued at $883m.
INTERVIEW WITH SCOTT MCWILLIAM. WSD recently had the chance to sit down with Australian winemaker Scott McWilliam of McWilliam’s Winery. More on the interview later this week.
On top of that, an increasing amount of the export market is run by bulk shipments as opposed to branded bottles, which is not good news for companies like Foster's and McGuigan Simeon who are hoping to recover in 2007-2008 with "value-added" brands.
Australian wine-producers worry that the decline in sales might be a possible indicator that Australian wines are viewed as “cheap wine” in the eyes of the consumer in the U.K. and U.S. According to local news sources, nearly 80% of the volume being shipped abroad is at the lower end of the price range, $2.50-$4.99 segment, which is currently losing share in the U.S. market.
Wine exports from Australia grew 6% in the twelve months to October, but the average price per liter dropped 8%.
"This was an expected result, given the continued growth in bulk wine shipments in response to the current oversupply of wine," said the Australian Wine and Brandy Corp.’s information and analysis manager, Lawrie Stanford, to The Age.
The United Kingdom (265m liters) and United States (211m liters) remained Australia's largest export markets, followed by Canada (53m liters), Germany (35m liters) and New Zealand (30m liters).
Australia exported some $927 million worth of wine to the UK, with exports to the US valued at $883m.
INTERVIEW WITH SCOTT MCWILLIAM. WSD recently had the chance to sit down with Australian winemaker Scott McWilliam of McWilliam’s Winery. More on the interview later this week.
posted at 1:46 PM
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