Wine Glut To Weigh On Producer Earnings

Years of strong global demand growth and healthy export values have contributed towards a potentially damaging wine surplus in New Zealand. Wine production has exceeded wine consumption in seven of the last 10 harvest years. While global demand for the country's high-cost, but perceived good-value wine exports was buoyant, the impact of this glut was marginal. However, as weaker global demand has coincided with widening surpluses, the impact on producer earnings has begun to be felt. While BMI does not view the glut as being as damaging as it has been in neighbouring Australia, we would nonetheless caution that rapid

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