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Australia's Strong Dollar Puts a Cork in Its Wine Sales

Australia’s surging dollar has hobbled exports of its vintages

Cellarbrations, a wine shop in the inner Sydney suburb of Newtown, sells Moët & Chandon Brut Impérial, a popular French Champagne produced by LVMH Moët Hennessy Louis Vuitton, for A$49.99 ($52.61) a bottle in six-bottle cases. Wine House, a Melbourne-based online store, is selling LVMH’s Chandon Green Point Cuvée 1995, a sparkling wine produced in Australia’s Yarra Valley, for A$52. Much to the dismay of Australia’s wine industry, its days of offering lower-priced alternatives to French vintages are fading.

With the Australian dollar at record levels against the euro, Aussie vintners are caught in a double-bind: Exports have been slammed as the cost of Australian wine has risen overseas, while oenophiles back home are embracing European bottles that suddenly are bargains. Imported wine has rarely been more affordable, with prices for some labels dropping 30 percent. “It’s absolutely fantastic,” says Jeremy Oliver, a Melbourne-based wine critic. “If you have A$100 ($105) in your pocket, that will get you a top bottle of Australian cabernet or shiraz. Today it also buys you a pretty serious Bordeaux, a very good Italian from any region, or a sensational Spanish red.”