Analysis of Australia's latest wine export figures brings into question the bullish reports of the last week. Although sales to the US reached a record A$42.6m (US$21.9m) in October, contract winemaking and branding is reducing the value and cutting into prices paid.

The average price for Australian wine sold into the US in October was A$5.73 a litre compared with A$6.83 in October 2000 according to Sam Tolley, chief executive of the Australian Wine and Brandy Corporation.

Tolley said exports to the US continued to show strong growth in October despite the September terrorist attacks and he did not expect any significant fall.

But average prices were being affected by wine bottled in Australia for American labels.

"Some US-owned American labels are sourcing Australian wine and selling in the US. It's called Australian wine but made under contract for US producers and tends to have lower value."

Tolley cited Constellation Brands, the US major that recently formed a joint venture with BRL Hardy of Australia, as an example of the alternative to actual purchase of the physical assets of an Australian winery.

Another quirk thrown up by the official Australian wine export figures was a surge in sales to the most traditional market of all, France. October figures showed exports to France up 87% in volume and 127% in value.

"We are seeing some Australian wine in French supermarkets with some of the younger people trying it," Tolley said.

"But it is mostly bulk wine that is being bottled there and trans-shipped to the United Kingdom."

France is the 13th largest buyer of Australian wine with sales worth A$15m in the past year.