US now biggest NZ wine customer

Rebecca Fox looks at the New Zealand Winegrowers’  annual report.

For the first time, sales of wine in New Zealand have been overtaken by sales into the United States and United Kingdom, New Zealand Winegrowers chairman Steve Green says.

Despite this drop, New Zealand Winegrowers' just released annual report shows exports have risen 10% in the last year as expected, to just under $1.6 billion.

''The ongoing progress towards the $2 billion goal is founded on our reputation as a wine exporter of the first rank, known for crafting and marketing distinctively New Zealand, high-quality, high-value wines,'' Mr Green said.

Sales at home dropped 7% to 56.3 million litres, which was due to the reduced supply from a smaller vintage in 2015.

Given the home market accounted for just over 20% of the global sales volume and was the only market for small vineyards, it remained critically important, he said.

''Further, its importance is growing in one critical area - inbound tourism.''

Tourism New Zealand data showed one in five visitors to New Zealand visited a winery or had some ''wine experience''.

Meanwhile the export market continued to go from strength to strength, with exports to the United States growing 24% to become New Zealand's largest wine market.

Similar growth was happening in the Canadian market, with sales up 13%.

Growth also continued in the traditional market of the United Kingdom, with exports up 8%.

''This continued strong performance is testament to underlying market and consumer demand for our wines in key markets.''

This growth had been impacted by continuing demand in those markets, supply constraints due to the smaller 2015 harvest and the drop in the value of the New Zealand dollar against the American dollar.

However, exports to Australia were flat as wineries diverted supplies to other markets in response to the high exchange rate and slow Australian economy.

As reported earlier, the improved supply from the 2016 vintage was expected to lift exports by another 10%.

The report also shows Central Otago wineries continue to grow, with 133 wineries listed this year, up from 127 the year before and surpassing the top year of 132 in 2014.

However, the vineyard producing area in the region reduced slightly from 1951ha last year to 1943ha this year.

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