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Photo for: The Growth and Future of Australian Wine Exports in the UK Market

Interviews

The Growth and Future of Australian Wine Exports in the UK Market

Exploring Trends, Regional Popularity, and Marketing Strategies

Australian wine exports to the UK have seen positive growth in recent years. This momentum can be attributed to various factors, including strategic responses to market fluctuations and innovative marketing approaches. As Wine Australia continues to capitalize on these trends, it is essential to understand the current dynamics of the UK wine market, the popular regions and grape varietals, and the new initiatives being launched to maintain and grow Australia's presence in this competitive market. In this interview with Laura Jewell MW, Regional General Manager at Wine Australia we delve into these aspects, exploring how Wine Australia plans to sustain and expand its influence in the UK.

Laura, Australian wine exports to the UK have seen positive growth in recent years. What factors do you believe have contributed to this trend, and how does Wine Australia plan to capitalize on this momentum?

There has been considerable fluctuation in export levels to the UK over the past few years, which was largely attributable to the process of leaving the European Union and the COVID-19 pandemic. In 2020, there was a steep rise in exports caused by these two factors working together. Brexit led to an increase in exports due to the demand for getting products into the market before the transition came to a close, and the off-trade category (where Australia holds the number one position) benefitted from the closure of the on-trade during the COVID-19 pandemic, which led to a further increase in exports to the UK.

As the on-trade re-opened in 2021 and 2022, there was a counter-swing in the demand for Australian wine as Australia’s share in the on-trade is substantially lower than that of the off-trade. Export value has now returned to a similar level as it was pre-Brexit. However, the UK is experiencing economic hardship with the cost of living crisis, and the additional duties on wine will squeeze margins for companies in the market, so it is likely that Australian exports to the UK will remain steady, but not see much increase in the next few years. 

Image: Australia Trade Tasting 2024

Which Australian wine regions and grape varietals are currently popular in the UK market? How does Wine Australia track and respond to changing consumer preferences in the UK?

With ancient soils, innovative winemakers, and diverse climates, Australia has so much to offer and is home to more than 150 grape varieties across 65 wine regions. While the classic varieties and famous regions are still proving very popular, there is a lot of excitement for new wave styles like minimal intervention and natural wines, fresh vibrant reds such as Grenache and Gamay, and alternative varieties such as Assyrtiko, Vermentino, and Nebbiolo. We keep up-to-date with consumer research and consumption data and we share this with brands, producers, and exporters in our Market Explorer hub on our website. 

The UK is known for its diverse and competitive wine market. How does Wine Australia differentiate Australian wines in this market, particularly in terms of branding, marketing strategies, and consumer engagement?

We know that the UK is a mature and knowledgeable market, but there is still a lot of work to be done to prove that Australia is not one large producing region, but has multiple styles, varieties, and regional variations to suit the most demanding of buyers. Our award-winning wines deliver on the promise of quality at every price point, expressing our generational knowledge, adventurous spirit, and deep commitment to our craft. We demonstrate this through education, working closely with the WSET and the IMW in addition to offering our Australian Wine Discovered education site free to all users. The big brands do a fantastic job of keeping Australian wine at the forefront of consumer minds, and we build on that through tastings and events to showcase the smaller and medium brands and wineries.

Image: Australian Wine, ProWein 2024.

The UK market has shown a growing interest in sustainability and ethical practices. How does Wine Australia promote the sustainability credentials of Australian wines to appeal to environmentally conscious consumers in the UK?

Sustainability is important to the sector and Wine Australia is working together with the Australian Wine Research Institute and Australian Grape & Wine to run the national program, Sustainable Winegrowing Australia, which measures and reports sustainable practices as well as encourages best practices in vineyards and wineries.

In May, Sustainable Winegrowing Australia launched its third Impact Report. It illustrates to retailers and consumers what’s involved in making sustainable wine and, reveals the progress certified members have made since 2020, the first year of reporting. In the 18 months to December 2023, 50% of members are now certified, a 235% growth in vineyard certification and 143% growth in winery certification. The report highlights how more members, are doing more at best practice; and the increased availability of wines now displaying the Sustainable Winegrowing Australia certification trust mark on bottles. 

Sharing the Impact Report, encouraging wineries to display the trust mark on bottles, and listing certified wineries at our events, enables retailers and consumers to identify sustainably made wine and helps people to buy better. 

You can find out more about Sustainable Winegrowing Australia and download the Impact Report from https://sustainablewinegrowing.com.au/

What role do you see Australian wines playing in the UK on-premise sector, especially considering recent trends towards at-home consumption? How does Wine Australia support Australian wine listings in UK restaurants and bars?

Australian wine is number one in the UK off-trade, and fourth place in the on-trade behind Italy, France, and the USA, so there is an opportunity to grow in the on-trade.

In the on-trade at the premium end, the diverse offerings from Australia can satisfy the most curious sommelier and find space on a wine list – it’s not all about the classic varieties and regions, although they are still proving hugely popular, now we have a proliferation of alternative varieties and lesser-known regions coming to the market. From Assyrtiko to Zibibbo we are seeing a strong community of winemakers who are producing the best quality wines across the country, experimenting with styles, understanding their terroir, and creating world-class wines. 

We run masterclasses and tastings for sommeliers and offer educational sessions and training for importers to help them and their customers sell more Australian wine. Our free education site, Australian Wine Discovered (www.australianwinediscovered.com), is also a great tool for sommeliers to train their teams, prepare for events, and keep up to date with Australian wine. 

Image: Australia Trade Tasting, 2024.

Are there any emerging markets or regions that Wine Australia is exploring for Australian wine exports? What criteria are considered when identifying new export markets, and what potential do these markets hold for Australian wine producers?

Wine Australia is working with the sector to diversify and find new markets and to intensify and re-energize existing markets for all Australian wine.

As about 60 percent of Australian wine is exported, market intensification and diversification is a key priority for Wine Australia and we’re working across multiple functions to help support this – from market insights through to marketing and market access.

The current priority markets for Australian wine are the US, Canada, UK, Nordics, Germany, the Netherlands, South Korea, Taiwan, Thailand, Vietnam, Indonesia, Japan, and now - as the import duties have been removed - China. It’s a broad spread of markets, each with its own trends. 

We provide support to producers and exporters via market guides, webinars, and our new Market Explorer, which launched this month. The Market Explorer can help determine which market is the most attractive to an Australian wine business by providing information on how much wine is consumed in different markets, where Australia exports wine to, and what share of that consumption is Australian wine. Find out more at https://www.wineaustralia.com/market-insights/market-explorer

Image: Australian Wine, ProWein 2024.

What new trends or developments are emerging in the Australian wine industry that consumers can look forward to? Are there any new grape varietals, winemaking techniques, or styles of Australian wine that are gaining popularity?

Our growers and winemakers are open, inquisitive, and adventurous, always looking to improve and not afraid to try new things – and while we respect tradition, we’re never beholden to it. Australian wine is adventurous, by nature, and always evolving.

Globally millennials are driving growth in alternative wine styles, such as natural, sustainable, organics, and fair-trade without rules restricting what can be planted where, and with a generation of creative, innovative winemakers, Australia has one of the most diverse wine scenes in the world. Australia’s array of varieties and styles excites younger consumers and adventurous drinkers in the on-trade who like exploring new wines ‘by the glass’ such as alternative varieties, Pét Nat, skin contact wines, and natural wines.

Demand for low and no alcohol beverages is expected to continue to grow, and Australia is well-placed in this area. In the UK, there are many low and no-alcohol offerings available from the likes of Hardys, Oxford Landing, McGuigan, Brown Brothers, and De Bortoli. There is a lot of research currently taking place into low and no-alcohol products, with Australia investing in developing the technology and growing the category of NOLO as well as mid-strength wines. 

The combination of diverse styles, old vines, winemaking tradition, sustainability practices, and research and innovation, sets Australian wine apart, making it a compelling choice for wine enthusiasts worldwide.

Wine Australia and New Zealand Winegrowers are partnering to host a trade masterclass in Manchester in June, showcasing wines from both countries. What can attendees expect from this event, and how do you envision it benefiting Australian wine exports in the UK market?

It’s the first time that Wine Australia and New Zealand Winegrowers have teamed up to run an in-person event in the UK, and it comprises a masterclass and a free-pour tasting. The event features 60 wines from 24 regions across Australia and New Zealand – including new releases and older vintages from iconic producers, alternative grape varieties and new wave styles, and organic, biodynamic, and sustainable champions. It will demonstrate the quality and diversity of Australian and New Zealand wines to buyers, importers, sommeliers, educators, and journalists, challenge perceptions, and showcase new styles. All the wines are available in the UK, so this is a fantastic opportunity for buyers looking to expand their portfolios. By sharing our wines and wineries’ stories, and educating and enthusing the trade, this will put Australia and New Zealand in the spotlight with influencers and decision-makers and will help the wineries and importers increase their in-market presence and grow the category. 

Looking ahead, what are Wine Australia's goals and strategies for further expanding Australian wine exports in the UK market? Are there any new initiatives or collaborations planned to achieve these objectives?

Our purpose is to build understanding, affinity, and preference for Australian wine globally. In the UK, our focus is on education, events, business development and supporting wineries in the market, and helping wineries to enter the market. We will be running our annual tasting in London and Edinburgh in early 2025 as well as having a stand at Wine Paris & Vinexpo Paris and ProWein. We will also be running masterclasses and tastings, education sessions, and training with importers and retailers. A new event for 2024 is the Australian and New Zealand Masterclass and tasting in Manchester in June. It’s the first time that Wine Australia and New Zealand Winegrowers have teamed up to run an in-person event in the UK. Through these activities across the year, we can showcase our diverse, thrilling wine scene, and educate and enthuse the trade. 

Conclusion:

The future of Australian wine exports in the UK market looks promising, driven by strategic marketing initiatives, a deep understanding of consumer preferences, and a commitment to sustainability. By focusing on education, innovation, and collaboration, Wine Australia is well-positioned to enhance its presence and appeal in the UK. Events like the upcoming masterclass in Manchester are pivotal in showcasing the quality and diversity of Australian wines, ensuring that they remain a preferred choice among UK consumers and trade professionals alike.

In conversation with Malvika Patel, Editor and VP, Beverage Trade Network

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