The wine industry is bracing for two consecutive years of falling export revenue due to tight grape supplies.
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Latest industry figures show in the year to June export value was down 3 percent to $1.87 billion, the first fall in export value in 26 years.
New Zealand winegrowers chief executive Phillip Gregan said the sector had experienced strong growth over a number of years, but it was now being constrained by a lack of supply.
"Despite the fact that we had a record harvest in 2020, our winery simply did not have the volume of wine available to them to support market growth for the whole for the whole year. And so we saw the first decline in wine exports."
Gregan said a smaller vintage harvest this year would no doubt lead to a further decline in export revenue.
Only 370,000 tonnes of grapes were harvested during the 2021 vintage, 19 percent less than last year's crop.
"It's not about the demand. It's all about our inability to supply unfortunately," he said.
Phillip Gregan said planting more vineyards to meet that demand was the way forward. At the moment plantings were increasing by about 2 to 3 percent annum, he said.