Strong yield increases grape harvest by 23%

A marked increase in New Zealand's grape harvest this year has been driven by strong yields and a young vineyard estate which continues to mature.

The New Zealand Winegrowers Association estimated the harvest was up 23% to 328,000 tonnes, Rabobank said in its quarterly wine report released this week.

The wine regions of Marlborough (up 34%), Waipara (68%), Nelson (32%) and Central Otago (15%) lifted production in the South Island, while less favourable conditions further north impacted on Hawkes Bay and Gisborne, which were down 9% and 21%, respectively.

The annual value of exports fell 6% while volumes declined 10% in the first quarter of the year.

The moving annual total bottled wine export unit value increased for the first time in more than two years to $8.70 per litre, in response to higher monthly bottled wine pricing and a lower proportion of bulk wine trade.

The average value of bottled wine exports in March, up 7.6% year on year to $9.51 per litre, represented the highest value recorded since June 2009.

The global over-supply situation in the wine industry continued to ease. Improving consumption and relatively light recent harvests have led to declining stocks in many regions and general improvements in bulk wine pricing across varietals and across regions.

A major contributor to rebalancing the supply/demand situation has been the rise in export sales volumes reported by many countries.

Major exporters such as Spain, Chile and Argentina were reporting substantial growth in export volumes in the first quarter of 2011 compared to the same period last year.

Improving sales, coupled with weak to average grape harvests for most regions over the past few years, have helped to reduce excess wine inventories and bring supply and demand closer to balance.

The 2011 harvest in Australia was estimated by the Winemakers Federation of Australia as 1.62 million tonnes, up 1%.

The estimate was higher than many had anticipated given the level of disease damage incurred in regions across southeast Australia.

The need to replenish tightening stocks might have led wine companies to accept a proportion of damaged fruit which would have been rejected in a normal year, the report said.

White grapes made up an even greater proportion of the harvest than usual (up 12.7%) as cool, wet weather prevented some red grapes (down 9.25%) from ripening.