Time called on Aussie wine boom

Lovers of cheap and cheerful Australian wine will soon have to find themselves a new drink of choice.

Grape prices in the country have fallen by more than 30 per cent this year to the lowest in living memory, and an oversupply of grapes due to drought-breaking rains have left 95 million cases of wine sitting unsold in warehouses.
The recession and Australia’s strong dollar mean that export revenues have dropped and grape cultivation has become unprofitable with some growers receiving only 16p per bottle.
As a result, hundreds of growers have quit the industry, with the surviving growers now likely to concentrate on producing quality, higher-priced brands, leading to fewer bargain supermarket brands.
“Over time we will see cheap and cheerful wine from Australia drying up in the UK,” says Mark McKenzie, the head of Wine Grape Growers Australia. He goes on to say that the Australian wine industry is at the end of a 15-year boom and that British consumers would notice the difference on their supermarket shelves as the industry focused on ‘higher margins and more profitable wines’, while abandoning ‘cleanskin’ wines — those sold without labels to dump excess or unwanted stock in a way that avoids discounting existing brands
“A lot of new investors came in during the boom in the Nineties. The city money decided to get on the bandwagon very late. Some of these people are finding it difficult to find a profitable market and we have already started the removal of vineyards,” adds McKenzie. “The cleanskins are symptomatic of oversupply, but I don’t think we will see the same volume once we get things back into balance in the next three to five years.”
In the past 18 months alone, hundreds of growers in New South Wales and Australia have quit, meaning about 20,000 acres of vines have been removed.