Wineries and breweries close as Australia’s alcohol consumption falls sharply

Cost-of-living pressures and a shift to non-alcoholic alternatives leave many businesses struggling

By LineZotpaper AI staff

Published25 October 2026

Read Time3 min

Sources2 outlets

Australian wineries and breweries are shutting down as alcohol consumption drops to record lows, with one Hunter Valley winemaker reporting revenue has fallen from $20,000 a week to just $2,000. The iconic Tasmanian brewer Boag closed last week, and wine exports have hit their lowest level in 22 years, as cost-of-living pressures and changing habits reshape the industry.

Nathan Heuston, who opened his Hunter Valley winery about five years ago, said business had plummeted. 'We were averaging, especially on our busy days, up to 220 people,' he said. 'This year we've even had days where we've had no-one.' His winery’s weekly revenue fell from about $20,000 to $2,000. 'We were taking a tenth of what we require to pay our bills. How do you recover from that?' he said.

The pain is widespread. The Independent Brewers Association confirmed more than 80 breweries have shut since June 2023. Seven hotel bars in Hobart entered voluntary administration earlier this year. Liquor sales at Coles dropped 3.3% last financial year, while Endeavour Group, owner of BWS and Dan Murphy's, saw retail sales rise only 0.7%.

Fitch Solutions data shows global wine volumes have declined in seven of the eight years to 2025, falling to 23.14 billion litres. In Australia, total alcohol consumption fell about 10% in the three years to 2024, with IBISWorld senior analyst Michael Doyle calling the 2024 financial year drop 'the sharpest we've seen on record.' The reduction is driven by younger Australians drinking less, tighter budgets, and the rise of non-alcoholic alternatives.

Non-alcoholic beer sales are projected to almost double from 150 million litres in 2024 to around 300 million by 2028, making it the fastest-growing beverage across the alcohol sector. Andy Miller, co-founder and chief executive of non-alcoholic brewer Heaps Normal, said sales were growing about 20% each year. 'What we're seeing in some of the more progressive venues around the country is that the non-alcoholic Heaps Normal draft is outselling other alcoholic counterparts,' he said.

Australian Grape and Wine chief executive Lee McLean described the period as 'the most difficult set of circumstances' the industry has faced in 'generations.' He said the industry would be 'a different shape and size' in coming years, with some businesses needing help to transition out or diversify. 'The message that we've been giving to government over the last little while is that grape growers and wine makers in many of these regions that are suffering need a hand to make a transition,' he said.

Alcohol Beverages Australia executive director Alistair Coe said the industry was innovating with greater product diversity and growth of low- and no-alcohol products. Minister for Agriculture, Fisheries and Forestry Julie Collins acknowledged the challenges and said the government had delivered over $105 million in funding, including the Wine Equalisation Tax rebate and a new mandatory code of conduct for wine-grape purchases. 'Our government will continue to work closely with industry on future opportunities,' she said.

Michael Doyle expects more pain ahead: 'People just don't have the money to spend on alcohol like they may have used to. I would expect to see a continual slow decline in per capita consumption.'

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Analysis

Why This Matters

The closures threaten jobs and local economies in wine and beer regions across Australia, particularly in the Hunter Valley and Tasmania.
The shift away from alcohol reflects a long-term generational change in drinking habits, accelerated by cost-of-living pressures.
The industry is likely to shrink and consolidate, with only those that adapt to lower consumption and non-alcoholic trends surviving.

Background

Global wine consumption has been declining for nearly a decade. Fitch Solutions data shows volumes fell in seven of the eight years to 2025. In Australia, total alcohol consumption dropped about 10% in the three years to 2024, with the sharpest annual decline on record in the 2024 financial year. Factors include younger Australians drinking less, tighter household budgets due to inflation, and the growing popularity of non-alcoholic beers and spirits.

Key Perspectives

Nathan Heuston (Hunter Valley winemaker): reports his business has plummeted, with revenue dropping from $20,000 to $2,000 a week, and some days with no customers. He has cut staff and production. Michael Doyle (IBISWorld senior analyst): says the 2024 financial year drop in alcohol consumption was the sharpest on record and expects a continued slow decline in per capita consumption. Lee McLean (Australian Grape and Wine chief executive): calls it the most difficult circumstances in generations; some businesses will not survive and need government help to transition to other crops or uses. Andy Miller (Heaps Normal co-founder and CEO): says non-alcoholic beer sales are growing 20% a year and are now outselling alcoholic counterparts on tap in some venues. Alistair Coe (Alcohol Beverages Australia executive director): says the industry is innovating with more low- and no-alcohol products. Julie Collins (Minister for Agriculture, Fisheries and Forestry): acknowledges the challenges and says the government has provided over $105 million in support, including tax rebates and a code of conduct.

What to Watch

Whether the government provides additional transition support for grape growers and winemakers in struggling regions.
Growth of non-alcoholic beer sales, projected to nearly double to 300 million litres by 2028.
The success of efforts to open new export markets in India and Southeast Asia to offset declining sales in the US and UK.

Sources

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12 claims in this story checked against 1 source: 9 supported.

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SupportedWineries and breweries are closing as alcohol consumption declines.Just In: “Wineries, breweries closing down as decline in alcohol consumption starts to bite.”
Partly supportedAustralia’s alcohol consumption has fallen to record-low levels.Just In: “In Australia, total alcohol consumption fell by about 10 per cent in the three years to 2024. "And the fall in the 2024 financial year was the sharpest we've seen on record," IBISWorld senior analyst Michael Doyle said.”
Partly supportedCost-of-living pressures and a shift to non-alcoholic alternatives are leaving many businesses struggling.Just In: “The reduction stems from younger Australians drinking less, tighter budgets with growing cost-of-living pressures and the rise of non-alcoholic alternatives.”
Partly supportedHeuston’s weekly revenue fell from $20,000 to $2,000.Just In: “Mr Heuston said his winery went from generating about $20,000 a week, to about $2,000 a week.”
SupportedBoag, an iconic Tasmanian brewer, closed last week.Just In: “iconic Tasmanian brewer Boag closing its doors last week”
SupportedWine exports hit their lowest levels in 22 years.Just In: “trade data in June showing wine exports having dropped to their lowest levels in 22 years”
SupportedHeuston said his winery had averaged up to 220 people on busy days.Just In: “"We were averaging, especially on our busy days, up to 220 people," he said.”
SupportedMore than 80 breweries have shut since June 2023, according to the Independent Brewers Association.Just In: “the Independent Brewers Association confirming more than 80 breweries have shut down since June 2023.”
SupportedTotal Australian alcohol consumption fell about 10% in the three years to 2024.Just In: “In Australia, total alcohol consumption fell by about 10 per cent in the three years to 2024.”
SupportedDoyle called the 2024 financial-year fall “the sharpest we've seen on record.”Just In: “"And the fall in the 2024 financial year was the sharpest we've seen on record," IBISWorld senior analyst Michael Doyle said.”
SupportedNon-alcoholic beer sales are projected to rise from 150 million litres in 2024 to around 300 million by 2028.Just In: “Non-alcoholic beer sales are projected to almost double in the four years to 2028, from 150 million litres to around 300 million.”
SupportedMiller said Heaps Normal draft is outselling alcoholic counterparts in some venues.Just In: “"What we're seeing in some of the more progressive venues around the country is that the non-alcoholic Heaps Normal draft is outselling other alcoholic counterparts."”