The latest edition of Wine Industry News, the monthly report and analysis by McGrath-Kerr Business Consultants, reveals that Australian wine is in significantly better shape than most people would believe. The key index behind this conclusion is the ratio of stocks to sales, which can easily be converted to the number of years of sales held in stock at any given time. Conventional wisdom would suggest that a healthy ratio for white wines is 1.5 years of sales in stock, and around 2.5 for red. Against this background, the projected figure for white wines is at June 2003 is just 1.1 years, while for reds the number is 1.73 years, the same level as 1999, before the appearance of the so-called lake of red wine that is apparently hindering the Australian market. Clearly, there is not enough Australian wine right now to satisfy traditional cycles of production and consumption, and the bulk red wine market is heating up again. Other facts that have perhaps escaped popular attention are that within an overall growth of 5.2% in domestic wine sales last calendar year, a significant 4.5% were sales of Australian wine. Led by increased in red wine sales in bottles and casks of 9% and 12% respectively, and a switch from casks to bottled white wines in a relatively static total white wine market, the industry is looking very good on the domestic front. Add to this the latest AWBC export figures showing moving annual growth figures of 35.1% for red wine and 16.1% for white wine, and the large companies with established export and domestic sales networks are looking pretty handy indeed. Some are also very cheap right now! Enquire about Wine Industry News on +61 2 6964 3504.
