Australia's red wine glut set to worsen after increase in national grape crush
A recent global downturn in wine drinking, particularly reds, has leading to a global oversupply and years of low prices for some wine grape growers.
Compounding the issue, Australia's wine grape crush increased overall this year, although it was still the third-smallest crush in more than a decade, according to Wine Australia's 2025 National Vintage Report.
Winemakers have been warned not to expect grape prices or demand to improve.
Wine Australia market insights manager Peter Bailey said the significant increase in red varieties was problematic and could exacerbate the industry's challenges.
"The increase in the red crush this year is not going to help that situation.
"Conditions are not likely to improve for red grapes until there is a significant reduction in the supply base."
The 2025 Australian wine grape crush was estimated at 1.57 million tonnes — worth an estimated $1.13 billion.
It represents an 11 per cent increase in volume on last year, but is still below the 10-year average of 1.71 million tonnes.
Chardonnay saw the biggest drop in volume — down nationally about 13 per cent — with seasonal issues playing more of a role than supply and demand.
Shiraz recorded one of the largest increases, up 23 per cent on the previous year.
Mr Bailey said that was at odds with consumer demand.
"There hasn't really been a strong increase in demand for shiraz in the market, so I can only imagine that the increase was really due to wineries taking in some of that fruit that was available," he said.
"The other point to make around some of those red varieties, is that the average price paid for the grapes is still very low and probably not economically sustainable for many of those grape growers.
"For example, with the Riverland shiraz, the crush itself was up 21 per cent on 2024 and the price was up 2 per cent, but at $204 per tonne is still exceptionally low and probably not economically viable for many of those growers."
Mr Bailey said the industry was working towards balancing supply and demand, but there was more to be done.
"This is the third vintage in a row that is below that 10-year average, so I think … the industry is starting to work together in bringing supply and demand back to more balance," he said.
"But the wine sector needs to continue to work together to get that balance, that profitable price point for growers and winemakers."
South Australia was once again the largest wine-grape-producing state, accounting for 48 per cent of the national crush.
Adelaide Hills grape grower and winemaker Peter Leske said he was surprised the nation had crushed more fruit than last year, given the global issue of oversupply.
"What we can't ignore is that, if and when people can't sell their fruit, or can't sell their fruit at a margin … the bad news of a smaller vintage is that [it] comes at a cost of individual growers' livelihoods," he said.
However, Mr Leske was very pleased with the quality produced.
"2025 was certainly a cracker in terms of quality in South Australia," he said.
"If we have to have too much very, very good wine in our cellars, it's better than too much poor wine."
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