Inexpensive low- to mid-range Australian wines are set to get cheaper, according to an Australian wine trade association.
Prices for non-premium Australian wines are likely to reach new lows, David Lowe, president of the New South Wales Wine Industry Association, told Australian newspaper The Daily Telegraph.
Bottles of wine presently retailing at around AUS$20 will fall by AUS$5, while bottles costing AUS$15 will be cut to just AUS$10, he told the newspaper.
According to a recent market study from the association, the Australian grape glut is to blame. Combined with what the study calls 'a slightly under-performing export market,' Australia is producing 'more wine than can be sold or comfortably stored', it says
'The last year has given little comfort to grape growers, with another bumper crop and moderate sales growth sending stocks to record levels by June 2005,' NSW chief executive officer Stuart McGrath-Kerr said.
'Hopes for an easing of this pressure through robust export growth and perhaps reduced grape production failed to materialise, placing the industry in a worse position heading into the 2006 vintage than it was a year earlier,' he explained.
Under the heading 'grape production,' the study notes the increase from 67,000ha of vines in 1993-94 to over 164,000ha at harvest in 2004.
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