Australian wine grape production is projected to increase by more than 5% to 1.93m tonnes over the two years to 2006-07, according to a report from the Australian Bureau of Agricultural and Resource Economics, ABARE.

This is despite the fall off in new vineyard plantings and increased vine removals reported by just-drinks.

Dr Brian Fisjer, ABARE's executive director, said premium white production would rise by 10% to 724,000 tonnes.

Premium red production would grow more slowly because of the decline in new plantings, up 2.5% to 974,000 tonnes. The outlook for wine exports was also positive, Fisher said.