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Brexit casts shadow over New Zealand exports as wine body reports ‘muted growth’

Published:  24 August, 2018

New Zealand wine is celebrating its 23rd consecutive year of export growth, with export value now valued at a record $1.7 billion.

However, this growth has been ‘muted’ compared to 2017, with growth up 2.5% in the year to June 2018, compared to 6% growth the year before, when it was worth $1.66 billion.

Supply constraints are expected to continue to have an impact on export growth, New Zealand Winegrowers said.

“In the coming year we predict export growth will continue to be muted given that the 2018 vintage was smaller than we had hoped. The final outcome will also be affected heavily by the exchange rate, which is currently looking more favourable,” said John Clarke, chair of New Zealand Winegrowers.

Clarke noted exporters were watching the growing uncertainty around international trade with concern, particularly in relation to Brexit.

“The UK is the second biggest export market for New Zealand wine with $386 million in exports, and wineries will be watching closely over the next nine months to gauge the possible effects of Brexit on international trade,” he said.

New Zealand wine is heavily reliant on international trade.

The 2018 Annual Report of New Zealand Winegrowers, which looked at performance worldwide, said the US continues to be the country’s largest market with over $500 million in exports.

Tourism is also playing an increasingly significant role in boosting the country’s profile, with 27% of international visitors to New Zealand visiting a winery.

Touring New Zealand’s  wineries and vineyards has become a major draw for visitors, with 279 wineries offering wine tourism experiences across wine regions, it said.