TWE Doubles Down on LoNo Wine with A$15 Million Facility

Treasury Wine Estates has launched a A$15 million dedicated facility for low- and no-alcohol wine production in South Australia’s Barossa Valley, marking a major investment in the growing global demand for lower-alcohol alternatives.

The A$15 million project, more than two years in the making, features cutting-edge dealcoholisation technology and a proprietary, patent-pending process aimed at preserving wine’s natural aromas and flavours — a challenge that has long plagued producers of low- and no-alcohol wines.

“This world-leading facility cements our position as a global pioneer in winemaking,” said Kerrin Petty, TWE’s Chief Supply and Sustainability Officer. “It’s the latest step in building a hub of innovation, technology and sustainability in the Barossa Valley, where we’ve been crafting wine to delight consumers for more than a century.”

The new site will be used to produce low- and no-alcohol wines under several TWE brands, including Squealing Pig and Pepperjack. Existing labels such as Matua, 19 Crimes, Lindeman’s and Wolf Blass are also expected to roll out new offerings from the facility.

In October, TWE plans to launch a new low-alcohol wine brand called “Sorbet” in partnership with Australia’s Endeavour Group. The lineup will include blends such as Prosecco, rosé, Sauvignon Blanc and Shiraz infused with tropical fruit flavors like passionfruit, mango and lemon. Alcohol content will be capped at 8% ABV.

Winemaker Toby Barlow said the ability to control the dealcoholisation process in-house will enhance wine quality and improve varietal expression.

“Bringing the process in-house allows us to better showcase the grape’s character and offer more high-quality options to consumers,” he said.

Sarah Parkes, general manager of sales and marketing for TWE’s global premium division, said the technology breakthrough addresses a long-standing issue in the category.

“Flavour has historically been a barrier for wine drinkers exploring a no or low alcohol alternative,” Parkes said. “This technology has helped us solve the flavour puzzle, and it’s had outstanding feedback from consumers so far.” Data shows that 50% of wine drinkers are reducing their alcohol intake, but taste continues to be the biggest barrier to purchasing wine that’s lower in alcohol.

The move comes as demand for lower-alcohol wine options accelerates. According to IWSR, the global no- and low-alcohol wine market is expected to grow at a compound annual rate of 5% from 2024 to 2028. 

In China, no-alcohol wines are often used in business settings and formal banquets where guests may be unable or unwilling to drink alcohol due to health or driving concerns, as we have reported. Low-alcohol wines are particularly popular among women and younger consumers, with growing demand in home and nightlife consumption.

A 2022 report from Tmall Innovation Center and Kantar estimated the Chinese low-alcohol drinks market reached RMB 33.8 billion (US$4.7 billion) in 2022 and is projected to hit RMB 74.3 billion (US$10.3 billion) by 2025.