Australian wine company growing export sales

While many areas of Australia’s economy are struggling under the weight of COVID, one local business is pushing forward with export growth across Europe and Canada.
Headquartered in McLaren Vale, Leconfield Wines is Australia’s oldest family-owned winemaking business. Owned by Dr Richard Hamilton and his wife, Jette, Hamilton is a fifth generation descendant of Richard Hamilton 1st who planted South Australia’s first wine producing vineyards in 1837. Leconfield Wines takes in Leconfield Wines in Coonawarra and Richard Hamilton Wines in McLaren Vale. Its brands include Leconfield, Richard Hamilton Wines and Syn Sparkling Wines.
Leconfield has a history of producing top-quality, award-winning wines. Its wines are sold across Australia, overseas and also served aboard Jetstar business class and on Great Southern Rail trains including The Ghan, Indian Pacific, Great Southern and The Overland.
“COVID has been challenging for us. As winemakers that sell our products direct to consumers through our membership and into restaurants and other hospitality outlets across the country, sales have been hit through the closure of venues.  The latest lock down in Victoria is particularly challenging,” Hamilton said.
“We have also experienced mixed results overseas with some markets including China reducing spend.
“However in the face of this, we have also risen to the challenge. We have restructured to focus on building collaborative partnerships and foster growth in other overseas markets, and these strategies are already starting to yield great results.
“Damian White has been appointed to the newly created role of Sales and Marketing Director.  He is firmly focused on expansion of our international market, alongside our valued domestic and online platform partners.  Christine Says has been appointed to the role of CFO to help manage the complexities of our burgeoning overseas markets to ensure strong growth and firm cost control.
“The recent decision by Canada to remove tariffs on the import of Australian wines has also opened up new opportunities for us too.”
Leconfield has been approved for distribution and sale in three Canadian provinces:  Ontario, New Brunswick and Quebec.
“We are extremely excited about this and are looking to augment our presence to other provinces as well,” Hamilton added.
“In addition to Canada, we have secured new opportunities in Finland and Belgium. In Belgium, we have partnered with Belgian food retailer, Delhaize, to supply a private label Coonawarra Shiraz under the name of Dalebrook Farm. We are already in talks regarding line extensions. This opportunity and various other emerging ones are really proving very positive for us moving forward.
“Our senior winemaker, Paul Gordon is doing an excellent job of creating new and exciting wines from our vineyards. His ability to craft, blend and perfect is delivering superb results for us and really bolstering our ability to continually impress the market with wonderful wines.
“Kate Mooney, our marketing and events manager, who has been with us for nearly seven years, is hard at work refreshing and developing our labels and packaging to ensure we stand out on shelves, catalogues and online sites.
“Despite the challenges we are facing here at home, we are determined to achieve growth. We’ve been through droughts, the Spanish Flu, world wards, the great depression, recessions, the GFC and now COVID.  You could say ‘we are battle hardened’ and we are not about to let a virus dampen our prospects. We are all in this together, and certainly at Leconfield Wines, we are determined to get through to the other side.
“We are very lucky.  At the end of the day, we can sit back and relax with a good drop.  One of the benefits of winemaking.”

Co-operation best bet as China investigates Australian wine imports

With Australian barley and beef already in the sights of the Chinese government, Beijing is now turning its eyes towards Australian wine as it opens up an investigation into whether or not Australian vintners deliberately dumped cheap wine into the Chinese market.

Tensions are running high between Canberra and Beijing as the Australian government starts flexing its muscle of Chinese incursions into the busy commercial water ways of the South China Sea.

In 2019, the value of wine exports to China were valued at just over $1.2 billion, and with the devastating bush fire season and COVID-19 taking hold, a lot of vineyards will be anxiously awaiting the outcome of the investigation.

In a statement, local vintner association Australian Grape & Wine, has taken a conciliatory approach.

“Australian Grape & Wine is aware of the request by the Chinese industry to the Chinese Ministry of Commerce (MOFOCM) to launch an anti-dumping investigation on Australian wine in China,” said Tony Battaglene, chief executive of Australian Grape & Wine.

“We believe that the Australian grape and wine sector is well placed to respond to this investigation and Australian Grape & Wine and our exporting companies will cooperate fully.

“China is an important market for Australian wine and our wine is in demand from Chinese consumers.

“Australia has a large number of exporters with close cultural ties to China.  The Australian industry welcomes the opportunity to build on these ties and work with the Chinese industry and government to further technical cooperation and develop lasting relationships.”

Speaking to the ABC, Victorian wine expert, James Hall, said, on average, a bottle of Australian wine in China costs three time as much as the locally-produced counterpart, with many in the Australian industry believing this more of a political than trade issue.

Finding new pathways to US consumers for Australian wine

COVID-19 restrictions have shattered the on-premise market for wine sales in the United States – Australia’s second largest export market by volume – resulting in lower total wine sales and significant revenue losses for some US wineries, according to the latest Rabobank Wine Quarterly report.

Over March and April 2020 combined, there was an estimated USD47 billion, year-on-year reduction in total sales in US foodservice and drinking establishment channels as restrictions set in.

And with sales in full-service restaurants and bars not likely to return to 2019 levels until after 2021, the Q2 report, titled ‘COVID -19 and the US premium wine market Part 1’, highlights that wine producers selling into the US market would need to find new ways of engaging consumers in the future.

Rabobank senior wine analyst, Hayden Higgins, said total sales for US food service and drinking establishments for the first four months of 2020 were down an estimated USD68 billion, or 22 per cent.

“For wine sales, the percentage drop in the on-premise channel will be even higher, given these are more heavily reliant on full-service bars and restaurants, which performed even more poorly than limited-service restaurants,” he said.

Higgins said the US on-premise wine sales channel was comparatively small in volume terms, but important for access and margins.

“The on-premise channel typically accounts for less than 20 per cent of annual wine sales in the United States, but it’s extremely important, particularly for small, premium wine brands which sell a greater proportion of their product into restaurants and bars,” he said.

Australian wine export figures reflected the premiumisation trend for wine in the US, and Australia’s efforts to capture more of this market.

While exports of Australian wine to the US for the year ended March 2020 were down 11 per cent by volume, they were only two per cent lower by FOB value in AUD terms – suggesting product was directed at the premium market.

And despite the drop in total Australian wine export volumes to the US, Higgins said Wine Australia reported that the average price per litre rose to the highest levels since August 2009.

The report said, barring a vaccine, the on-premise US wine sale channel would likely take years to recover.

“Between government enforcement of social distancing measures, consumer reluctance to return on premise due to fears of contagion, and reduced business and tourism travel, many bars and restaurants may be forced to permanently shut their doors unless a vaccine is made available sooner than most experts expect,” Higgins said.

“Given these, and other, challenges, it’s anticipated the US foodservice industry will likely not return to 2019 levels until after 2021, and that the recovery would be led by limited-service restaurants and take-out/delivery, where there is less consumption of premium wines.”

He said larger wholesalers who had a greater proportion of sales in the off-premise, as well as more financial muscle, should be better placed to withstand these challenges.

Higgins said the US alcoholic beverage market’s three-tier system was particularly challenging for smaller wine brands.

“The US alcoholic beverage market operates under a three-tier system made up of manufacturers in the first tier, a second tier comprised of importers, distributors or wholesalers who purchase the product from the manufacturer, and a third tier of retailers,” he said.

“Under this system, producers are unable to sell directly to US consumers. It’s therefore essential brands work closely with their US distributors – who are in regular dialogue with retailers – so they can better understand changes in the way US consumers are purchasing wine.”

Implications for Australian winemakers
With the on-premise channel in the US struggling, Higgins said Australian wine brands would need to consider how their distributors were currently working with retailers, and also planning for future channel changes in the way consumers purchase wines.

For Australian producers vying for share in the US market, he said, digital strategies will become increasingly critical for sales success.

“While the on-premise sales are currently facing monumental challenges, the growth in e-commerce has been well-documented, and will provide an important opportunity for wineries seeking alternative growth strategies – both in the US, Australia and other markets,” Higgins said.

“We’re already seeing this process well underway in Australia, as wineries try to offset the decline in tasting room sales with e-commerce.

“Beverage companies are finding new, innovative ways to connect with consumers wherever they are, in a digital environment and to help drive sales across channels.”

For Australian wine exporters, Mr Higgins said, considering how e-commerce at the retail level and connecting to the US consumer would evolve – and how distribution partners were preparing for this – should be a core component of discussions, and were relevant conversations for other markets beyond the US.

“These questions include how they think about e-commerce within the organisation, whether they should buy or build an e-commerce team and where it should sit within the organisation.”

Higgins said Tsingtao, the Chinese beer company, provided one recent example of a beverages company that has used e-commerce to increase sales.

“Tsingtao used lockdown measures in China as an opportunity to further create a network of ‘community distributors’ – essentially social media influencers working on commission – that has been extremely successful by a number of measures,” he said.

Australian wine has record breaking presence at expo in China

Australian wine took centre stage in mid-November with a record-breaking presence at ProWine China 2018 – an international trade fair for wine and spirits.

Wine Australia’s largest-ever pavilion showcased Australia’s booming wine sector at the event, based in Shanghai.

A record 47 exhibitors showcased 90 wine brands – compared to 40 brands in 2017 ­– from more than 20 wine regions across Australia, including Adelaide Hills, Barossa Valley, Beechworth, Clare Valley and Yarra Valley.

Wine Australia chief executive officer Andreas Clark said China is such a critical market so it was great to see the pavilion jam-packed with Chinese wine trade, hearing the stories of wineries and learning about the diversity of styles available.

READ: Wine Australia looks at trends for smaller exporters

“Thanks to the [Australian government’s] $50m [wine] package, we were able to hit the trade show en masse and give wineries the opportunity to bolster relationships with existing clients or connect with prospective partners face-to-face – be they importers, distributors, wine merchants or food and beverage managers.

“Between the 47 exhibitors, 6 in-pavilion tastings, 2 master classes and a seminar on cutting-edge wine business technology, the “Australian Wine Made Our Way” themed pavilion was bustling with activity,” said Clark.

In-pavilion tasting classes inlcuded:

  • the next wave of Shiraz from Victoria – including Heathcote, Yarra Valley, Mornington Peninsula, Beechworth, Rutherglen, Grampians and Pyrenees
  • Margaret River’s emergence as a world-class region for exceptional Cabernet Sauvignon
  • alternative varieties – exploring the diversity of McLaren Vale wines
  • a tasting journey exploring the Barossa’s diverse palette of varieties, flavours and textures

The public master classes showcased rare and distinguished Barossa varieties, blends, estates, single vineyards and flagship releases; and the history and tradition of premium McLaren Vale Shiraz.

Exhibitor Damian Shaw, managing director of Philip Shaw Wines in Orange, said there is a good strength of Australians representing in this market.

Helen McCarthy, from Mountadam Vineyards in Eden Valley, said relationships are really important, especially in the China market where they’re key to doing business.

“It’s important for us to come and support our importer in building those relationships.

“In some of the tastings I’ve done external to ProWine, it’s been quite a generational change. A lot of younger excited people are learning about wine. It’s just so different to 10 years ago,” said McCarthy.

China has become Australia’s biggest and most valuable wine export market. Exports, including Hong Kong and Macau, soared 55 per cent to more than $800 million in the past 12 months, accounting for 40 per cent of Australia’s total exports, Wine Australia indicates.

Wine Australia looks at trends for smaller exporters

In the year ended September 2018, there were 2401 active Australian wine exporters, Wine Australia explains.

The majority of these – 87 per cent – are companies that export fewer than 10,000 cases per year.

Another 9 per cent export between 10,000 and 50,000 cases per year, and only 4 per cent of exporters ship more than 50,000 cases each year.

The 3 per cent of companies that ship more than 100,000 cases contribute 88 per cent of the volume and 74 per cent of the value of total Australian wine exports.

READ: NSW international wine tourism enriched with $2 million boost

Interestingly, companies that ship fewer than 50,000 cases per year contribute a much higher share to value – 21 per cent – than to volume – 9 per cent, because smaller wine producers sell their wines at higher price points, while many bigger companies ship unpackaged wine at lower average prices, Wine Australia indicates.

For example, shipments that are valued below $2.50 per litre free on board and above $10 per litre have an equal share of total value – about 25 per cent – for companies that ship more than 50,000 cases per year.

In contrast, for companies that ship less than 50,000 cases, 50 per cent by value is shipped at above $10 per litre.

Overall, companies that exported more than 50,000 cases per year contributed $191 million to the increase in value of Australian exports – a growth rate of 10 per cent over the previous year, while companies that exported fewer than 50,000 cases contributed $75 million – a growth rate of 15 per cent.

Growing wine exports is a key focus of the Australian Government’s $50 million Export and Regional Wine Support Package.

In October 2018, Wine Australia commenced its Growing Wine Exports program for new and experienced wine exporters looking to grow their exports and give their export strategies a health check.

The program comprises one-day Export Ready Sessions and two-day Export Plan Workshops that are being rolled out nationally throughout 2018–19.


Australian exhibitors showcase wines at festival in Hong Kong

Australia has cemented its position as a highly popular country precinct at the 10th Hong Kong Wine and Dine Festival held on October 25-28.

Wine Australia reports the festival is Hong Kong’s largest consumer-facing event that attracts more than 144,000 attendees.

In its third year at the event, the Australian wine sector introduced festival goers to an enhanced program of fun and educational activities to give them a lasting impression of the country’s wine scene, with support from the Australian government’s $50 million Export and Regional Wine Support Package.

The ‘Australian Wine Made Our Way bar’ featured a diverse line-up of premium wines from 12 regions across Australia –the Adelaide Hills, Barossa Valley, Clare Valley, Eden Valley, Hunter Valley, Langhorne Creek, Margaret River, McLaren Vale, Mornington Peninsula, Riverina, Rutherglen and Tumbarumba.

READ: Australian wine continues to be the flavour of international markets

Two themed wine stalls – the ‘refreshing sparkling, white and rosé booth’ and the ‘rich and bold red booth’ – gave patrons a chance to explore a collection of varieties that are on-trend in Australia and are becoming popular in Hong Kong.

Wine Australia CEO Andreas Clark said for this year’s event, Wine Australia focused on enhancing its presence to have a greater appeal to consumers.

“When they come to the Australia precinct, we want them to enjoy themselves while learning what our great wines have to offer. It’s about creating a lasting impression of our winemakers, our regions and our diverse and premium wines,” said Clark.

The Hong Kong Wine and Dine Festival kicked off a line-up of China-focused activities over the next month, with the China International Import Expo, the Wine Australia China Awards and ProWine China all happening from early-to-mid November.



Australian orange exports increase but drought still burdens other sectors

Rabobank’s agribusiness October outlook indicates growth in wine and fruit exports, but meat and grains are falling short.

The monthly report shows that fresh orange exports continue to grow in price and volume, as well as wine exports to Canada.

Canada is one of the top wine export destinations for Australia by value.

For July and August 2018, compared to the same period in 2017, Australian exports of all wine to Canada have lifted by about 17 per cent in volume and 7 per cent in value.

READ: Cattle prices trend down as drought conditions increase pressure in market

Fresh orange exports have grown substantially since 2013, with global trade data indicating total Australian fresh orange exports of 197,000 tonnes in 2017.

Global trade data shows that in 2017, key Australian export markets for oranges had increased in value by $107m, which is almost double the 2013 value.

Over the same period, export volumes grew by about 46,000 tonnes, an increase of about 50 per cent on 2013.

Despite growth in some wine and fruit markets, dry weather and frost damaged winter crops in the grains and oilseed sector, with south-west New South Wales missing out on much needed rain over September.

Rabobank reports that parts of Victoria, South Australia and Western Australia were hit with frosty conditions, which caused significant damage to crops.

The Frost and ongoing dry conditions have reduced 2018/19 new crop prospects on grains and oilseeds.

Wool supply is set to continue to fall in the coming months and a dry outlook gives downside potential for young cattle.

A three-month outlook of the weather is expected to bring little rain to the country.

Despite the dry conditions, cattle prices lifted slightly or stayed steady throughout September and some rainfall through eastern states provided hope and ability to hold cattle rather than sell them, Rabobank reports.

September slaughter numbers (567,400 head) in the eastern states continue to reflect the drought-induced sales, up 15 per cent year-on-year.

Beef exports for September (91,668 tonnes swt) remain high, up 4 per cent year-on-year.

China remains hungry for Australian beef with exports up 55 per cent year-on-year, however they still remain Australia’s fourth-largest export market behind Japan, the US, and South Korea.

Live exports in comparison to 2017 YTD (August) are up 21 per cent, with stronger volumes to Indonesia and Vietnam throughout the year to date up 10 per cent and 40 per cent respectively.

In addition, live exports to countries besides Indonesia and Vietnam (such as Malaysia and Middle East) has increased 195 per cent, since 2017 year-to-date.



Australian wine exports to Canada increase in volume and value

In 2017–18, the volume of Australian exports to Canada increased by 11 per cent, to 7.6 million cases, and value increased by 7 per cent to $199 million.

Canada is Australia’s fourth biggest export destination by volume and value.

Exports grew by value to all ten provinces. More than 80 per cent of Australian wine by value is shipped to three provinces – Québec, British Columbia and Ontario.

British Columbia was the stand-out with volume up by 29 per cent and value up by 12 per cent.

READ: Australian wine export grants increase to $1.5 million

Québec, Ontario and British Columbia are also the three largest provincial wine markets in Canada with a combined volume share of 82 per cent.

Québec is the biggest provincial wine market in Canada with total sales of 18.9m cases.

In 2017–18, wine sales grew by 5 per cent, driven predominantly by imported wines from France, Italy, Spain and Australia.

Australia is the fourth ranked wine category behind France, Canada, and Italy.

Australian exports to Québec increased by 2 per cent in volume and 9 per cent in value in 2017–18.

There was growth in both Australian bottled and unpackaged exports, but the growth was significantly stronger in unpackaged exports.

The average value of bottled exports increased marginally to $5.39 per litre, while unpackaged exports increased by 16 per cent to $1.02.

Exports of red and white wines grew, but the growth was much stronger for whites.

Red wine exports increased by 5 per cent to $28m while whites increased by 18 per cent to $15m.

There were 78 Australian companies exporting to Québec during the year – up from 65 the year before.

Ontario is the second biggest provincial wine market in Canada with total sales of 15.8m cases.

In 2017–18, wine sales grew by 2 per cent with wines from Italy, the United States of America and Canada the key growth categories.

Australia is the fourth ranked category behind Canada, Italy and USA.

Australian exports to Ontario increased by 11 per cent in volume and 3 per cent in value in 2017–18.

British Columbia is the third biggest provincial wine market in Canada with total sales of 8.5m cases sold.

In 2017–18, sales were flat in British Columbia with growth in wines from Canada and Italy offsetting declines from most other suppliers such as USA and Argentina.

Australia is the fourth ranked supplier behind Canada, USA and Italy.

Australian exports to British Columbia increased by 29 per cent in volume and 12 per cent in value in 2017–18.


Australian wine export grants increase to $1.5 million

More wine businesses visiting China and the USA to build their exports will benefit following a 50 per cent increase in funding for the Wine Export Grants program.

The total pool of funding for the Wine Export Grants program has increased to $1.5 million, in recognition of the high demand for the grants.

Wine Export Grants of up to $25,000 are available for small and medium wine producers to reimburse 50 per cent of specific export promotion expenses.

Wine Australia chief executive officer Andreas Clark said the $500,000 boost is welcome news for wine producers.

READ: Australian wine exports to Germany grow by $10 million in one year

“Since the grants opened on 2 January 2018, we’ve approved more than $500,000 of funding for participation in international tradeshows, and a high volume of claims is currently undergoing assessment.

“This funding boost means more support for wine businesses looking to grow their exports, or secure new distribution channels, in the key markets of China and the USA,” said Clark.

The grants are a key component of the Australian government’s $50 million Export and Regional Wine Support Package, which aims to drive demand for wine exports and showcase the nation’s wine tourism.

Administered by Wine Australia, the program invites eligible wine producers in Australia to apply for reimbursement grants of up to $25,000 for 50 per cent of specific export promotion expenses.

Eligible claims include:

  • reimbursement of travel expenses for a single promotional visit to China (including Hong Kong and Macau) and/or the USA
  • the cost of providing free samples of the wine you’re promoting for export
  • participation in trade fairs and in-store promotions, and
  • marketing and advertising.

Each eligible wine producer can only receive the grant once within the duration of the grant program.

The grants are open for applications until May 1, 2020, or until the funds are exhausted.

Australian wine exports to Germany grow by $10 million in one year

Australian wine exports to Germany have grown solidly from 37 million litres valued at $49 million in 2016–17 to 40 million litres valued at $59 million in 2017–18, a wine report indicates.

According to the Global Trade Atlas, in 2017–18, Italy was the biggest imported wine category by volume with a 35 per cent share, followed by Spain at 26 per cent, France at 15 per cent, South Africa  at 6 per cent, and Australia at 3 per cent.

Australia overtook Chile in 2017–18.

Germany is the world’s biggest imported wine market and fourth biggest wine market overall.

READ: Artificial Intelligence helps accurately map Australia’s 65 wine regions

It is Australia’s fifth largest export destination by volume and eighth by value.

The lower value ranking is principally due to the way in which wine is shipped from Australia to Germany – 85 per cent is shipped in bulk containers to be packaged in-market.

There were 20 bulk wine exporters and 105 bottled wine exporters to Germany in 2017–18.

The growth in the last 12 months has come through increased bulk shipments, up 11 per cent to 34 million litres, while bottled exports declined by 9 per cent to 6 million litres.

Driving the growth in bottled exports at $5 or more was Riesling and Chardonnay, which more than offset declines in Shiraz/Cabernet Sauvignon and Shiraz.

While Germany is a stable and mature market, new opportunities are being created in the German wine market by increasing involvement and greater consumer openness to experiment with new and different styles of wine.

The adult population in Germany in 2017 totalled 66.2 million people.

According to Wine Intelligence, of these, 44.2m drink wine at least once a year, 27.5m drink at least once a month and 19.5m drink wine weekly.

The International Wine and Spirit Record (IWSR), reported that in 2017 there were 276 million cases of wine sold in Germany, of which 51 per cent were imported wines.

The German market is price conscious with 71 per cent of still wine sales at the low-end of the market at less than $5 per bottle.

Premium to prestige wine sales, at $12 per bottle and above, represent 2.5 per cent of the still wine sales.

In 2017, there were declines at the bottom and top-end of the market.

Sales below $5 per bottle declined by 0.3 per cent, while sales above $24 per bottle fell by 1.9 per cent.

There was growth at the mid-range and premium price segments. Sales between about $5 and about $24 per bottle increased by 0.5 per cent.

The price profile of the German market reflects where Germans buy their wines.

Wine Intelligence reports that 58 per cent of regular wine drinkers purchased wine in a supermarket such as Rewe or Edeka, 45 per cent in a discounter such as Aldi or Lidl, and 43 per cent in a hyper-market such as Kaufland and Marktkauf.

In comparison, 32 per cent purchased wine from a specialist wine store.

Still red wine is the biggest category in the German market just ahead of still white wine.

However, while red wine sales declined by 1 per cent, white wine sales increased by 1 per cent.

Champagne is the fastest growing category with sales up 2.7 per cent, but it has only a 0.4 per cent share of the market.

But, other sparkling wine is the third biggest category in the German market, with a large proportion taken up by the locally made Sekt.

Wine Intelligence research indicates there has been a significant increase in regular wine drinkers in Germany who ‘enjoy trying new and different styles of wine’, particularly among younger consumers.

A growing number of German consumers think their choice of wine is an important decision, suggesting that they are becoming more involved with wine.



Funding flows in for Western Australia’s wine regions

Western Australia’s wine regions are receiving funding from the Australian government.

A $2-million marketing campaign to boost international visits to Western Australia’s wine regions received support from the Australian Government’s $50 million Export and Regional Wine Support Package, a network of WA Government and sector partners.

Wines of WA has secured $1 million in funding through the International Wine Tourism State Grants program and $1m in matching state funds, through a consortium of state government agencies and tourism, agricultural and regional bodies.

Wine Australia chief executive officer, Andreas Clark, said the Wines of WA application was approved by the Australian Government following assessment by an independent expert assessment panel.

READ: Four of the five largest markets for Australian wine exports have grown in value

“The $5m state grants program aims to maximise the wine sector’s impact on state economies – it’s about driving collaborative, strategic wine tourism initiatives that attract international visitors to our wine regions,” said Clark.

Wines of WA was working with the Western Australian Department of Primary Industries and Regional Development, Tourism WA and their counterparts in the wine, trade and agriculture sectors to cross promote WA’s wine, food and tourism destinations and experiences, he said.

Wines of WA collaborative wine tourism strategy aligns with the existing Western Australian Wine Industry Strategic Plan 2014–2024, which aims to double wine exports to $100m by 2021.

Wines of WA chief executive officer, Larry Jorgensen, said the investment plan was built around four key areas – in-region and inter-region collaboration with key sector partners, wine tourism product development, a comprehensive suite of digital marketing tools and partnerships with tourism operators and agencies.

“The aim is to build on the strong brand of regional hotspots like Margaret River and create new wine tourism experiences in other regions to extend tourists’ spend and length of stay in WA”, said Jorgensen.

The $5 million International Wine Tourism State Grants program requires applicants to provide matching funding on a dollar-for-dollar basis.

Victoria’s wine industry gets a $2 million boost from the government

Victoria’s wine industry has received a $2 million boost from the government through the third round of the wine growth fund.

Member for Buninyong, Geoff Howard, represented minister for agriculture and regional development, Jaala Pulford, on the 30th of July, to announce the extra funding and expanded guidelines for the fund.

Howard said the wine industry contributed more than $7.6 billion to the economy.

“[It] employs more than 13,000 people in grape growing, wine making, cellar door sales and hospitality operations – that’s why we’re investing in its future.”

READ: Four of the five largest markets for Australian wine exports have grown in value

The fund aims to develop and sustainably grow the wine industry in Victoria by providing innovative growers, organisations and projects with money to build both domestic and international markets.

It supports activities including marketing, exporting, tourism and business development.

Funding guidelines have been altered so infrastructure projects that attract significant investment and create new jobs are eligible for grants of up to $100,000.

The first two rounds of the fund supported 106 projects worth nearly $2 million in Victoria.

These projects have created new jobs in the wine industry, generated an increase in visitation to Victoria’s wineries, and increased sales and exports of Victorian wines.

Pulford said the government was proud to announce a third round of this program.

“Victorian winemakers produce beautiful wines for every occasion, taste and price and we’re supporting them on the world stage and closer to home.”

Applications are open to businesses or organisations from all wine regions in Victoria directly involved in the wine industry, including the growing, making and marketing of wine.

Four of the five largest markets for Australian wine exports have grown in value

Four of the largest markets for Australian wine exports grew in value and volume in the 2017/18 financial year.

At $2.8 billion, the value of Australian wine exports has seen the largest growth in 15 years. This is a 20 per cent growth.

But, of the five largest markets, the only one not to grow in value and volume was the US market.

Wine Australia CEO Andreas Clark said the strong growth in the value and volume of Australian wine exports is very welcome, but the challenges and opportunities for the sector were very clear.

READ: Wine Australia to invest $67.8m in ambitious agenda for coming year

“USA is the world’s largest wine market and Australia has the opportunity to capture more of the premium end of the market as American consumers trade up to higher priced wines,” said Clark.

Australia had been strong in the commercial half of the US market, as 54 per cent of the US off-trade volume was wines under US$8 per bottle, but this market was shrinking, he said.

American consumers are transitioning from commercial wines to more premium wines.

“The premium end of the USA wine market is enjoying robust growth, as are Australian exports in nearly all price points above $10 per litre. We’re working to accelerate this growth in demand through a marketing push supported by the Australian government’s $50 million export and regional wine support package,” said Clark.

An inaugural Australia Decanted event was launched at the end of July, at Lake Tahoe, California.

“This four-day wine education program is immersing 100 key influencers, from the USA in Australia’s diverse and thriving wine scene, to raise awareness of the breadth of Australia’s fine wine offering and the perception of the Australian wine category in the USA,” said Clark.

“Australia Decanted will become Wine Australia’s signature annual event in the USA and will be followed by Aussie Wine Week, in September this year, and Aussie Wine Month in September 2019,” he said.

Despite challenges in the US market, there was an increase in the average value of bottled
exports shared by 69 of the 127 destinations for Australian wine, with demand for premium
Australian wine in Northeast Asia being the biggest contributor to value and volume growth.

The growth in exports was driven by a 15 per cent increase in active exporters compared to the previous 12 months, with 2298 exporters shipping 23,761 unique products. Of these exporters, 1616 either started exporting or grew the value of their exports, contributing $653 million to the growth in overall export value.

Dalefold Wines’ licence suspended for exporting unapproved products

Australian company Dalefold Wines has had its licence to export grape products from Australia suspended.

The Board of Wine Australia suspended the licence in late-July after discovering the company was exporting grape products that were not approved by Wine Australia.

While the suspension remains in place, Dalefold Wines may not export wine from Australia.

Wine Australia is seeking further information from Dalefold Wines before deciding the length of the suspension and considering whether the licence should be cancelled.

READ: Wine Australia to invest $67.8m in ambitious agenda for coming year

Wine Australia last cancelled a licence in the 2015-16 financial year.

Wine Australia found out that Dalefold Wines exported three grape products from Australia for which an export certificate was not in force.

By doing so, Dalefold Wines contravened section 44 of the Wine Australia Act 2013 and the Wine Australia Regulations 2018.

The company also engaged in activity that aimed to leverage from the reputation of another wine brand in China through causing consumer confusion.

This was done to the extent that it could affect the export trade in all grape products from Australia by diminishing consumer confidence in the integrity and authenticity of Australian grape products in China.

It could also cause harm to the reputation of all Australian grape products, relations with importers, current promotional strategies or the marketability of Australian grape products relative to competitors.

Changes to the Wine Australia Regulations 2018 earlier this year mean that other exporters may not export wine on behalf of Dalefold Wines now that its licence has been suspended.

Wine Australia acts to protect the reputation of Australian wine by regulating export shipments, conducting audits of wine producers and ensuring the truthfulness of claims made on Australian wine labels in both the domestic and export markets.

There are currently 2298 active licensed exporters.

Wine cannot be exported from Australia without an export licence issued by Wine Australia, which has the power to suspend or cancel licenses when necessary.

$1m in grants available for wine exports

Australian wine businesses that export to China, Hong Kong, Macau and the United States can now apply for up to $25,000 in Government funding to support specific export promotion activities.   Read more