Wine Treasury Estates to destroy stock destined for US

Australian wine company Treasury Wine Estates, which owns brands including Penfolds, Beringer, Lindeman’s and Wolf Blass, is to destroy old stock destined for the US market, due to oversupply to this market. Shipments from Australia to the US are expected to fall by 2 million cases in 2014. The company has also allocated a further AU$40m for discounts to accelerate the sale of excess vintage wines in the US distribution network.

Chief executive David Dearie said that part of the problem is greater distributor efficiency, but Dearie also conceded that the action is partly a result of over ambitious forecasting.

Australian wine exports fell 2 percent to AU$1.82 billion ($1.67 billion) in the past year as a decline in red wine exports outweighed an increase in whites, according to the June report from Wine Australia.

This comes at a time when the Australian economy is upside down with a falling Australian Dollar.