US demand soaks up Kiwi wine exports

New Zealand’s wine export values continue to rise thanks to strong demand from the United States, which reached $1.66 billion for the year, up 6 per cent on the previous year.

While the percentage increase is lower than the average yearly growth of 17 per cent for the past 20 years, the industry was on track to reach $2 billion of exports by 2020, the chairman of New Zealand Winegrowers, Steve Green, said.

NZ Winegrowers’ latest annual report shows that, to the end of June this year, the US market is worth $517 million, up 12 per cent.

New Zealand wine became the third most valuable wine import into the US, behind only France and Italy.

Green forecast that next year’s export volumes would be ‘‘more muted’’ because of the smaller harvest of 396,000 tonnes, down 9 per cent on 2016.

While the US provided the best returns, more litres (74 million) of wine were exported to the United Kingdom for a much smaller return of $389m. Behind the US and UK came Australia, Canada, the Netherlands and China.

The most exported variety was sauvignon blanc, followed by pinot noir and chardonnay.

The recently passed Geographical Indications (Wine and Spirits) Registration Act would offer improved protection of New Zealand’s regional identities.

Of a total growing area of 37,129 hectares, sauvignon dominates at 22,085ha, an increase of 685ha from the year before.

The second most popular variety was pinot noir, with 5653ha, followed by chardonnay at 3203ha and pinot gris (2469ha).

Marlborough is overwhelmingly the largest region with 25,135ha planted in vines, followed by Hawke’s Bay (4694ha), Central Otago (1896ha) and Canterbury/ Waipara (1425ha).

The number of wineries was 677, after having reached a peak of 703 in 2012.

Kiwis drank 40 million litres of imported wine in the past year, most of it Australian (29 million litres), with the next two most popular being French and Chilean.

The November Kaikoura earthquake damaged an estimated 20 per cent of Marlborough’s tank capacity, but by harvest time all of the lost capacity had been restored or replaced.

Green said the industry consulted with members on possible changes to export tasting requirements, with responses suggesting a rethink of export requirements was needed.

‘‘We continue to believe more needs to be done in our export legislation to ensure that the same standards apply to every bottle of New Zealand wine, no matter where it is bottled,’’ Green said.

In June the New Zealand Grape Growers Council and the Wine Institute of New Zealand finished as entities, replaced by a unified NZ Winegrowers.

Organic wine production continues to flourish, with more than 60 New Zealand wineries now making fully certified organic wines.

Wine is New Zealand’s largest goods export. fifth