By Ian Neubauer
The US economic slowdown is causing a slowdown in wine exports, a peak industry regulator revealed this week.
The Australian Wine and Brandy Corporation (AWBC) released figures on Monday showing the value of total wine exports had declined 2 percent to $2.85 million, while export volumes had tumbled 7 per cent to 737 million litres.
The figures are linked to a 30 per cent decline of bulk wine exports and a 45 per cent decline in the import of soft-pack exports.
The US, the second largest export market for Australian wine products, accounted for the majority of the decline, where consumer confidence is teetering near recession levels as a result of the sub-prime mortgage crisis and the mounting cost of the Iraq war, now estimated to be greater than $3 trillion.
Compounding the decline is the soaring Australian dollar and cheaper exports from Chile, which has been earmarked by experts to replace Australia and New Zealand as the principal player in the US international wine market. Last year Chilean wine exports to the US surpassed $1 billion dollars, making it the number one export market for Chilean wine, according to the Santiago Times.
On a positive note, the average price of Australian wine exports climbed 5 per cent, while demand from emerging markets in China, Singapore, Japan and Northern Europe contributed $32 million to the sector.