New Zealand's dairy, meat and grain farmers are not the only producers cashing in on soaring international commodities markets -- wine exporters expect to hit $1 billion in exports by 2010.

Winegrowers, who used to earn less export revenue than the national onion crop, have boosted the offshore earnings by 14 percent in the past year to a record $797.8 million. Last year the export earnings rose 16 percent to $766 million from $661 million the previous year.

New Zealand Winegrowers chairman Stuart Smith said the sector results released today were in line with projections, and the industry expected to be earning $1 billion of exports annually by 2010.

Production, in terms of wine volumes, has risen at a compound annual growth rate of about 20 percent over the past decade, with this year's vintage survey showing the latest harvest was up more than 30 percent on the drought-ravaged 2007 vintage.

Mr Smith said the quality of vintage 2008 appeared sound, with the best wines set to be "sensational".

He said there would be challenges for the sector, such as the economy and a significantly increased volume of wine to sell offshore in the wake of this year's big vintage.

"The current economic situation has laid down a challenge for the coming year, but this is a challenge the New Zealand wine industry is ready to meet," he said. "There is huge potential to build on the significant successes to date."

For the year to June 30, offshore sales totalled 88.6 million litres of wine and with domestic sales, total earnings from New Zealand wine for 2008 were $1.25 billion.

Mr Smith said a focus on quality and a strong, unified industry were major factors in the 2008 result. "Each year we have made projections about sales and growth and each year these are fulfilled and often surpassed," Mr Smith said. "This year is no exception."

This year there had been a shift in key export markets with Australia becoming the largest export market by value, up 37 per cent to a record $247 million, despite the fact that Australia is itself a major wine exporter.

Exports to the United Kingdom -- previously NZ's largest market -- grew by only 8 percent on 2007. "The focus on premium quality is clear, with the average bottle of New Zealand wine sold in the United Kingdom now Stg6.47 ($NZ17.17) which is Stg2.09 ($NZ5.54) ahead of the nearest competitor," Mr Smith said.

It was exciting to see exports of New Zealand wine growing each year in not only those two key markets but emerging markets such as Japan and Ireland, which Mr Smith said were "brimming with potential".

"As consumers become increasingly more discerning, the quality of New Zealand wine increasingly stands out," Mr Smith said.

There had also been a 50 percent increase in the numbers of growers and wineries joining Sustainable Winegrowing NZ, which meant that now more than 70 percent of the nation's total production capacity is under a sustainability scheme.

"The industry is making good progress to having 100 percent of all wineries and vineyards producing under an independently audited scheme by 2012," Mr Smith said.