A Bottle Of Wine For 50p – Only In Australia!

Very occasionally in Australia water is more expensive than wine.

As crazy as it sounds, it’s true and happening again right now for a whole host of reasons.

Australia is one of the world’s big wine exporters, shipping 750 million litres a year overseas. Right now there is flagging demand internationally so much of the wine that was originally intended for export is now available to the domestic market.

Partly this is due to a strong Australian currency, particularly against the US dollar, depressing Australia’s export market. Around 17% of wine imported to the US is from Australia.

Furthermore, the strong currency makes it more likely that other countries will increase exports to Australia, further driving down local prices.

Another interesting aspect of this is that duty on wine in Australia is set according to price. So, the lower the price you charge, the less duty you pay.

Finally, there is a lack of retail choice. Currently two supermarkets, Woolworths and Coles, have 70% of the wine retail market, which means that there is little opportunity for producers to negotiate higher prices for their products.

All in all, this perfect storm means you can buy a bottle of wine in Australia for as little as one Australian dollar, or around 50p.

The full story from The BBC.

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