An Australian economist has warned that Australian wine prices could fall by 10% within four years.

According to local press reports, Professor Kym Anderson of Adelaide University said a major marketing expansion was needed in Australia to maintain current wine grape prices. And, that a global model of price projections was sobering news for the wine industry.

Anderson, a director of the Australian Grape and Wine Research and Development Corporation told the university newspaper that preliminary model results show real premium wine grape prices in Australia would be 7% to 10% lower in 2005 than in 1999.

Calling for the federal government to phase down the wine equalisation tax and lower import barriers in countries overseas, Anderson said there were a number of strategies available for Australian winemakers to improve their premium market share.

"The most crucial thing is knowledge, about new technologies, evolving tastes, marketing and distribution systems and how to use and influence them," he said.

"Wine producers need to capitalise on their chances now to reap the rewards in the medium and long term," he added.