Australia and New Zealand released trade figures on Tuesday, August 25, that point to the same underlying story: international wine sales are shrinking, and the prices producers can command are under mounting pressure.
Australia's exports fell to their lowest level in 22 years, while New Zealand managed to grow its shipped volume, but at the cost of nearly flat revenue and a lower average price per liter.
A Global Slowdown in Alcohol Consumption
The pattern in Australasia mirrors a broader trend identified by data firm IWSR, which projects 2025 as the third consecutive year of declining alcohol consumption worldwide. Two forces are widely cited as driving the slump: consumers with less disposable income to spend on discretionary purchases, and a growing cultural shift toward health-conscious lifestyles that favor moderation or abstinence. Together, these forces are reshaping demand for wine in markets that once reliably absorbed Southern Hemisphere production.
Australia: Exports at a 22-Year Low
Wine Australia's figures for the fiscal year ending in June show exports falling below 600 million liters — a level not seen since 2004. In value terms, foreign sales totaled 2.7 billion New Zealand dollars (2.3 billion Australian dollars), a decline of 7% from the prior year.
Paul Turale, Wine Australia's managing director of market development, argues that the pressures weighing on international wine demand show no sign of easing. He frames the situation not as a temporary dip but as a structural change in the market, driven by a combination of lower consumption, tighter regulation, climate volatility, trade uncertainty, and evolving consumer habits.
New Zealand: Volume Up, Value Barely Moving
New Zealand's export picture looks different on the surface but reveals similar underlying strain. New Zealand Winegrowers reported export volumes exceeding 306 million liters for the year to June — an increase — yet total value rose just 0.5%, to roughly NZ$2.1 billion. The average price per liter slipped from NZ$7.27 to NZ$6.88, underscoring how much of that volume growth came at the expense of margin.
Charlotte Read, general manager of brands at New Zealand Winegrowers, describes an industry in the midst of rapid adjustment to changing consumer preferences. According to Read, wineries are reassessing export markets and distribution networks, hunting for greater value per bottle, and adapting operations to softer demand. In the vineyard, that adjustment is becoming tangible: growers are revisiting planting plans and tightening expenses to bring supply in line with the market. The shift isn't uniform nationwide — in Tairāwhiti, producer Indevin cut its grape supply in May, and reports from the Gisborne region describe thousands of vines being uprooted.
Even so, Read believes New Zealand holds a comparatively strong position. She points to sustained demand for New Zealand wine in several markets, its premium positioning built on environmentally friendly production practices, and the fact that nearly 90% of the country's output is white wine — a category gaining ground in a number of Asian markets.
The UK: Diverging Fortunes
The United Kingdom, Australia's largest market by volume, illustrates how differently the two countries are faring. Wine Australia's UK sales fell to 192 million liters for the year to June, a 6% drop and the lowest level in 25 years, with value down 3% to NZ$410 million (A$340 million). The decline hit mid-priced wines particularly hard.
New Zealand moved in the opposite direction in the same market, with UK exports rising 16% in volume and 4% in value, reaching NZ$426 million.
The United States: Tariffs Compound the Slowdown
In the US, weaker demand combined with tariff uncertainty to hit both countries, though Australia bore the brunt. Australian exports to the US dropped 15% in volume and 27% in value, falling to NZ$274 million (A$229 million) — Wine Australia names the US as one of the biggest contributors to its overall export decline.
New Zealand's US exports also fell, but less sharply: down 5% in volume and 7% in value, to NZ$720 million.
Canada Absorbs Diverted Volumes
Both countries shipped more wine to Canada over the period, a shift that appears to reflect the diversion of volumes away from weaker markets rather than genuine demand growth in Canada itself — a sign of exporters redistributing supply toward whatever destinations still offer room to sell.
China: A Study in Contrasts
Mainland China, historically a major market for Australian wine, saw Australian sales fall 15% in value to NZ$906 million (A$756 million). Wine Australia attributes the drop to a slower-than-expected recovery following the removal of tariffs in 2024, though it notes the loss was partly cushioned by stronger results in Singapore, Thailand, and Japan.
New Zealand's China business tells a different story. Starting from a much smaller base, New Zealand's shipments to China grew 72% in volume and 24% in value, surpassing NZ$69 million — one of the few unambiguous bright spots in either country's export data.
What It Means for the Industry
Taken together, the Australian and New Zealand figures describe an export environment defined by softer consumption and intensifying price pressure, even in markets where volume is holding up or growing. For wineries, distributors, and importers, this shifting landscape is likely to influence everything from vineyard planning and inventory decisions to how export contracts are negotiated and which product ranges are prioritized for each market going forward.
Source: Vinetur