New World wine lake ?

Adelaide newspaper The Advertiser reports that Australian wineries currently have one billion litres of unsold wine, equivilent to 2/3rds of the 2005 vintage with a record 2006 harvest about to begin.

With bumper harvests in California too there is a lot of unsold wine sloshing around. Grape growers will feel the pain of drastically reduced prices for their grapes. While consumers should see some price reductions too, as wine brands fiercely compete for custom.

But I don't expect fine wine prices to fall, they never seem to.