Australian Wine Production Jumps 9% in 2025 as Stockpiles Grow Amid Weak Demand

Australian wine production has increased in the 2024–25 period, even as demand remains subdued, according to a new report from Wine Australia. The national wine association said that production outpaced sales during the year, resulting in a 5% rise in stock levels across the country. This development comes at a time when the industry is still recovering from previous lows and facing ongoing challenges in both domestic and international markets.

The report, based on a survey of large Australian winemakers, found that total wine production from the 2025 vintage reached 1.13 billion liters, equivalent to 126 million nine-liter cases. This figure represents a 9% increase compared to 2024, but it remains 7% below the ten-year average of 1.22 billion liters. Red wine production saw a notable jump of 15%, while white wine production rose by just 2%. For the first time since 2023–24, red wine regained its position as the dominant category, accounting for 52% of total output.

Despite the uptick in production, sales volumes have not kept pace. The total volume of Australian wine sold in 2024–25 is estimated at 1.08 billion liters, or about 120 million nine-liter cases—almost unchanged from the previous year. Export sales made up 59% of this total, marking a slight increase from last year.

Export growth was driven largely by renewed shipments to mainland China. In the past twelve months, exports to China increased by 53 million liters to reach 85 million liters. This marks the first full financial year since China lifted tariffs on Australian wine imports. However, Peter Bailey, manager of market insights at Wine Australia, noted that current export volumes to China are still less than half their peak levels from 2017–18. The difference between current and peak export volumes to China equates to about 130,000 tonnes of wine grapes, mostly red varieties.

Bailey explained that while production has rebounded from a twenty-year low recorded in 2023, it remains below historical averages due to high stock levels carried into the new vintage. He also cautioned that the increase in unsold inventory could further dampen demand for both wine and wine grapes in coming years. As a result, grape prices are unlikely to improve in the near future.

The Australian wine sector continues to face headwinds from changing global market conditions and shifting consumer preferences. While exports have shown some signs of recovery following trade normalization with China, overall demand remains under pressure both at home and abroad. Industry analysts say that without significant changes in consumption patterns or new market opportunities, producers may continue to struggle with oversupply and stagnant prices for some time.