New Zealand wine exports grew eight per cent to $1.12 billion in the year to June 30, as the high dollar eroded profits.
The annual report of New Zealand Winegrowers, which represents about 1,000 growers and 700 wineries, says total export and domestic sales increased 10 per cent to a record 242 million litres.
International wine sales have increased by 79 per cent since 2007.
New Zealand's overall freight-on-board price per litre fell seven per cent to $6.58.
Globally, New Zealand is the 10th largest exporter of wine by value and the 11th largest for volume. New Zealand is second, behind France, in terms of the average price at which wine is sold.
"Profitability is a key concern," chairman Stuart Smith said.
"Lower yields this year have restricted grower incomes while for wineries the challenge will be to maintain shelf space and grow key development markets in a time of tight supply.
"Returns have also been impacted by the high New Zealand dollar and domestic tax increases," he said.
Australia remains New Zealand largest export market, with exports across the Tasman totalling $380 million. Exports to the UK were $284m, while the US market continued to "perform strongly" on $250m.
"The UK imports a greater volume of New Zealand wine than Australia but the value is lower due to the weak pound and large proportion of bulk wine exports," Smith said.
"Bulk wine has now become the norm for popular premium wine imports for all counties into the UK."
Exports to Canada lifted 20 per cent to $70m, while China rose 50 per cent to $25m.
NZN
