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Home / The Country

NZ wine production fall in 2024 adds to new Southern Hemisphere output low

By Andrea Fox
Herald business writer·NZ Herald·
16 Dec, 2024 12:55 AM4 mins to read

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World wine production is 13% down on the 10-year average, says a new report. Photo / 123rf

World wine production is 13% down on the 10-year average, says a new report. Photo / 123rf

A forecast 21% decline in New Zealand wine production this year contributed to historically low wine output from the Southern Hemisphere as extreme weather took its toll on harvests.

In its first estimates for the world wine production outlook, the International Organisation of Vine and Wine (OIV) said preliminary estimates for the Southern Hemisphere this year showed a challenging vintage, marking the lowest production output in two decades.

New Zealand’s production was forecast to be 2.8 million hectolitres, 21% down on 2023 and 13% below the five-year average.

This was primarily due to Marlborough’s reduced harvest from frost damage during the critical flowering period, said OIV, which collected comprehensive data for 2024 from 29 wine-producing countries representing 85% of global wine production.

A hectolitre is a metric unit of capacity equal to 100 litres.

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World wine production for 2024 was forecast to be net 2% down on 2023’s “already-low volume” and 13% down on the 10-year average, said OIV, the 51-member state intergovernmental science and technical organisation for the global vine and wine industries.

France-based OIV is headed by Kiwi John Barker.

Weather events affected wine production volumes worldwide, exacerbated by economic and market conditions, its report says.

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Southern Hemisphere wine production represented 20% of the world total, consistent with the past decade’s average.

“After a record-high harvest in 2021, [Southern Hemisphere] wine production has declined for three consecutive years, with the 2024 total estimated at 46 mhl (millions of hectolitres), a 2% decrease from 2023 and 12% below the five-year average, marking the lowest production since 2004.

“This historically low output stems from significant climatic events across major wine-producing regions.

”Southern Hemisphere key wine-producing regions experienced significant drops: Australia, Argentina, Chile, South Africa and Brazil recorded production volumes between 4% and 21% below their five-year averages.

“As with 2023, extreme or atypical meteorological events are the key influence on global production, with early frosts, heavy rainfall and prolonged drought dramatically impacting vineyard productivity.

“This underscores the wine industry’s increasing vulnerability to climate variability, highlighting the urgent need for adaptive strategies and resilient viticultural practices in the face of escalating environmental uncertainties.

“At the same time, a second consecutive year of reduced production, occurring within a market context of decreasing global consumption and high inventory levels, could contribute to a market equilibrium mitigating the immediate economic impact of reduced production for some regions or producers.”

Australia’s wine production was estimated to be 10.2mhl in 2024, a slight 5% increase from 2023, but remaining 16% below the five-year average, said OIV, which marked its 100th anniversary this year.

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Australia continued to be challenged by excessive rainfall and inventory pressures, it said.

Low production volume in the European Union was expected for 2024.

France recorded the most significant drop in production compared with 2023, largely due to challenging weather events.

Italy recovered slightly this year from very low volumes in 2023, and regained its title of the world’s biggest wine producer, OIV said.

“Generally, volumes across Europe were below average, with only Portugal and Hungary recording average or above average harvest volumes.

“First forecasts from the USA indicate an average production volume for 2024 slightly below 2023 levels.”

France, leading producer last year, showed the largest fall in production, with its low output substantially influencing the worldwide wine supply, OIV said.

Only a small group of producer nations – the US and several Eastern European countries – experienced more favourable climatic conditions, achieving average or above-average production volumes.

Andrea Fox joined the Herald as a senior business journalist in 2018, and specialises in writing about the $26 billion dairy industry, agribusiness, exporting and the logistics sector and supply chains.

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