Drastic measures taken to control the oversupply of New Zealand wine resulted in a 2010 vintage 8% lower than 2009, although the country's premium image is still at risk from recently-created retail "value labels", according to its industry body.
European director of New Zealand Winegrowers David Cox said that while supply and demand are on track to be back in balance with the 2011 vintage next summer, a 16% increase in bulk wine production to 21% of New Zealand exports in 2010 should act as a "wake-up call" to wine growers.
"We risk eroding our well-earned price premium, reputation and image with the continuation of deep price discounting by some labels, and the selling of bulk wine to retailers, who are creating 'value labels' and 'trade drivers'," he said. "It is incumbent on all of us to get our average price back up to more than £6 by the New Year."
The average off-trade price of New Zealand wine, which was £6.24 last year, has slipped to £5.97, but is still higher than other wine importing countries the nearest is France at £5.11 [Nielsen 2 October].
Oversupply following a bumper harvest in 2008 meant over the past 18 months retail buyers had been able to source lower-priced, good quality juice, but the vintage reduction and a double digit increase in global demand would bring that to an end, claimed Cox.
Winemakers left vineyards dormant and turfed up vines last year to bring supply under control, and in January the vintage was predicted to be 10-15% lower than 2009. The subsequent 8% reduction was therefore not as low as hoped, admitted Cox, but increases in global demand meant it was "not such a problem".
The country is aiming to overtake Spain's value share, which is 7.2% of UK wine sales, within the next two years, he added.
In the past year off-trade sales of New Zealand wine grew 27% in value and 33% in volume [Nielsen MAT 2 October], and it is ranked eighth biggest importer with a 5.1% share.
Pernod Ricard launched a TV campaign for its Brancott Estate New Zealand wine this week.
European director of New Zealand Winegrowers David Cox said that while supply and demand are on track to be back in balance with the 2011 vintage next summer, a 16% increase in bulk wine production to 21% of New Zealand exports in 2010 should act as a "wake-up call" to wine growers.
"We risk eroding our well-earned price premium, reputation and image with the continuation of deep price discounting by some labels, and the selling of bulk wine to retailers, who are creating 'value labels' and 'trade drivers'," he said. "It is incumbent on all of us to get our average price back up to more than £6 by the New Year."
The average off-trade price of New Zealand wine, which was £6.24 last year, has slipped to £5.97, but is still higher than other wine importing countries the nearest is France at £5.11 [Nielsen 2 October].
Oversupply following a bumper harvest in 2008 meant over the past 18 months retail buyers had been able to source lower-priced, good quality juice, but the vintage reduction and a double digit increase in global demand would bring that to an end, claimed Cox.
Winemakers left vineyards dormant and turfed up vines last year to bring supply under control, and in January the vintage was predicted to be 10-15% lower than 2009. The subsequent 8% reduction was therefore not as low as hoped, admitted Cox, but increases in global demand meant it was "not such a problem".
The country is aiming to overtake Spain's value share, which is 7.2% of UK wine sales, within the next two years, he added.
In the past year off-trade sales of New Zealand wine grew 27% in value and 33% in volume [Nielsen MAT 2 October], and it is ranked eighth biggest importer with a 5.1% share.
Pernod Ricard launched a TV campaign for its Brancott Estate New Zealand wine this week.
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