Perfect storm lashes Hunter wine exports

Wine export sales from the Hunter Valley have gone into a ''disastrous'' freefall, hit by an Australian dollar that reached record levels, the global financial crisis and increasing international competition.

Hunter wineries exported 700,000 litres worth $4.6 million in the past year, a sharp drop from the 3.2 million litres valued at nearly $20 million achieved eight years ago, Wine Australia figures show.

''It's disastrous,'' said Andrew Margan, winemaker and president of the Hunter Valley Wine Industry Association. ''We were the bright shining star, the oldest wine-growing region in Australia.''

Total exports of Australian wine fell from $2.37 billion to $1.83 billion over the past decade.

Out of the top nine wine regions, the Hunter Valley experienced the largest percentage decline.

Mr Margan blamed the ''perfect storm'' of the strong Australian dollar, global recession and growing competition overseas. But he said the biggest factor was the negative impact of the wider industry pushing ''brand Australia'' overseas several years ago.

''It needed to expand into regional diversity but regionality is not the big guys' strong suit,'' he said.

''Wine was marketed by using big company dollars and they led us into an area disastrous for us.''

The new focus on high-volume ''generic wines'' meant the Hunter, which largely produced premium wines, was left in the cold, Mr Margan said.

Bill Sneddon, winemaker of 30 years at the boutique Allandale Wines, used to export 20 per cent of his yearly production of about 225,000 litres. That figure plummeted to 5 per cent during the global financial crisis.

''The US was our biggest market. At one point we had wines in 17 states,'' he said. ''Now we export nothing to the US and very little to the UK. We've pulled out of Malaysia and Fiji too.''

He has placed his hope on China where a wine-drinking culture is rapidly developing.

''The Chinese market is diversifying and there is demand for super premium wines.''

Mitchell Taylor, director at the Winemakers' Federation of Australia, said the industry had to tackle an image problem in the US.

''Consumers will realise the extracted, high alcoholic wines are not to last and will swing back to elegantly made wines we're good at,'' he said.

Barossa exports were up from $50 million to $64 million in the past three years. Only the Barossa and Margaret River posted record export figures last year. James Gosper, general manager of marketing at Wine Australia, said both regions were spending promotional funds in Asia and North America.

He said the Hunter Valley was a ''critically important'' part of Wine Australia's plans to boost wine tourism coupled with food.

''They're still a shining light, the most-visited wine region, on the doorstep of Sydney,'' he said.