Australian Wine Industry Proposes Distilling Surplus into Biofuels like Ethanol Amid Glut
Facing a severe oversupply of 263 million liters of wine, the Australian wine industry has proposed distilling the surplus, mostly red wine, into biofuels such as ethanol for vehicles and aircraft. While technically feasible, experts note that government subsidies would likely be necessary to make the process economically viable.
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- 📰 Published: May 18, 2026 at 18:40
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(CNA, Sydney, 18th, by reporter Chiu, Te-chen) While high oil prices are causing hardship for the transport industry and car owners, the Australian wine industry is facing the problem of overproduction. The industry has proposed a solution: distilling wine into biofuels like ethanol for use in vehicles, which could also resolve the issue of excess wine production capacity.
The Australian Broadcasting Corporation (ABC) reported yesterday that Australia's wine supply exceeds demand, with a current national surplus of 263 million liters. In response, the industry suggests converting this wine into biofuel for cars, trucks, and even airplanes.
The report mentioned that 263 million liters of wine can be distilled into approximately 30 million liters of fuel ethanol.
Lee McLean, Chief Executive of Australian Grape and Wine, pointed out that the vast majority of the surplus wine is red wine. He believes the economic benefits, barriers, and opportunities of converting red wine into biofuel are worth exploring.
McLean admitted that wine sales are not ideal. Global wine consumption in 2025 has dropped to 1961 levels, when the world's population was only about 40% of what it is today. He mentioned that in addition to the wine glut, excess vineyard planting capacity is exacerbating the problem.
Professor Rachel Burton, a botanist at the University of Adelaide, believes that using wine to produce biofuels like ethanol is technically entirely feasible. She noted that the ethanol in wine is essentially the same as the ethanol in E10 gasoline; the only difference is in the "purification process."
Burton pointed out that since wine has already been fermented, ethanol is already present in the liquid. Bioethanol can be separated out through distillation, the same process used to make spirits. "Distillation is the process of separating alcohol through heating; it's basically the same as making whiskey or tequila," she said.
Burton stated that the biggest difference between winemaking and refining biofuel is that the former must consider consumer taste, while for the latter, taste is irrelevant. "Airplanes don't care what their fuel tastes like," she said.
Wine industry consultant Leon Deans warned that while distilling wine into ethanol is a viable solution for the surplus, it would likely require government subsidies to be implemented, as the cost of distilling wine may be greater than the return on the ethanol.
"For every liter of wine, you might need an additional 15 US cents (about NT$4.74) in revenue to cover the cost gap," Deans said. He warned that Australia's grape oversupply problem is the result of past over-reliance on the Chinese market and capacity expansion. Now that the Chinese market is smaller than before, the industry must re-evaluate its entire structure and market. (Editor: Wei, Shu)
The Australian Broadcasting Corporation (ABC) reported yesterday that Australia's wine supply exceeds demand, with a current national surplus of 263 million liters. In response, the industry suggests converting this wine into biofuel for cars, trucks, and even airplanes.
The report mentioned that 263 million liters of wine can be distilled into approximately 30 million liters of fuel ethanol.
Lee McLean, Chief Executive of Australian Grape and Wine, pointed out that the vast majority of the surplus wine is red wine. He believes the economic benefits, barriers, and opportunities of converting red wine into biofuel are worth exploring.
McLean admitted that wine sales are not ideal. Global wine consumption in 2025 has dropped to 1961 levels, when the world's population was only about 40% of what it is today. He mentioned that in addition to the wine glut, excess vineyard planting capacity is exacerbating the problem.
Professor Rachel Burton, a botanist at the University of Adelaide, believes that using wine to produce biofuels like ethanol is technically entirely feasible. She noted that the ethanol in wine is essentially the same as the ethanol in E10 gasoline; the only difference is in the "purification process."
Burton pointed out that since wine has already been fermented, ethanol is already present in the liquid. Bioethanol can be separated out through distillation, the same process used to make spirits. "Distillation is the process of separating alcohol through heating; it's basically the same as making whiskey or tequila," she said.
Burton stated that the biggest difference between winemaking and refining biofuel is that the former must consider consumer taste, while for the latter, taste is irrelevant. "Airplanes don't care what their fuel tastes like," she said.
Wine industry consultant Leon Deans warned that while distilling wine into ethanol is a viable solution for the surplus, it would likely require government subsidies to be implemented, as the cost of distilling wine may be greater than the return on the ethanol.
"For every liter of wine, you might need an additional 15 US cents (about NT$4.74) in revenue to cover the cost gap," Deans said. He warned that Australia's grape oversupply problem is the result of past over-reliance on the Chinese market and capacity expansion. Now that the Chinese market is smaller than before, the industry must re-evaluate its entire structure and market. (Editor: Wei, Shu)