Winegrape growers are calling for presidency help with an oversupply of grapes that’s sinking costs and leaving fruit unsold.
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Key factors:
- Wine exports drop by 26 per cent in 12 months with no aid in sight for winegrape growers
- Oversupply of grapes may see “generational shift” as vineyards hit the market
- Grapes left unsold, whereas wineries construct further storage to accommodate the glut of wine
The disaster within the world freight sector, together with China’s resolution to impose huge anti-dumping tariffs simply as Australian growers produced a big crop in 2021 are behind the glut.
The most recent Wine Australia figures present exports have been down 26 per cent year-on-year.
This has been coupled with rising enter prices, which have not less than doubled previously 12 months resulting from elevated disease-pressure and the price of chemical, fertiliser, gas and labour.
Business physique Australian Grape and Wine mentioned it anticipated troublesome industrial situations for the subsequent three to 5 years.
Winegrape oversupply
The scenario is very dire in South Australia’s Riverland, the place 80 per cent of the wine produced is exported.
Riverland wine government officer Lyndall Rowe mentioned whereas curiosity from south-east Asian markets had been promising, it couldn’t take up the availability within the quick time period.
“It’s nonetheless constructive as a result of it’s a basis step … however it’s going to take time to develop.”
Ms Rowe said the drop in demand had led many wineries to seek outside storage and build additional tanks.
While the region finished harvesting grapes in early May, Riverland’s CCW Co-operative chief executive Jim Godden said storage at most wineries was full by March.
Mr Godden said he did not know how many members were out of contract but had received numerous calls from people trying to find a home for their grapes.
Generational shift in vineyard ownership
The Riverland is home to more than 900 growers but some are choosing to get out of the game.
Real estate agent Sam Hayes from Toop Toop Rural said a number of vineyards in the region have been listed recently.
Mr Hayes said while the initial interest was from local buyers, the value for money could attract wider investment.
“What is currently a liability could be an asset again very soon.”
Not too long ago, Australia’s largest family-owned vineyard, Casella Household Manufacturers, put 35 of their vineyards up for sale throughout New South Wales and South Australia.
Colliers is handling the sale and national director of agribusiness Tim Altschwager said the offering was not related to the current oversupply issues.
Outlook for subsequent season ‘disastrous’
In the Riverina, there are growing concerns that wineries could cap grape deliveries for next year, which could see the price of red grape varieties drop even further.
Riverina Winegrape Growers president Jeremy Cass said the outlook for next season was “disastrous”.
Fourth-generation Griffith winegrape grower James Cremasco described the current situation as a losing battle, but said they would keep going, as the family always had.
“There may be a number of hardship, and there is generational farmers. I’ve obtained mates my very own age, they’re all speaking about ‘what are we doing this for?’,” Mr Cremasco mentioned.
Help wanted as grapes left to rot
In the Murray Valley it is estimated that 20,000 tonnes of fruit were left unsold this season.
Murray Valley Winegrowers executive officer Paul Derrico said anyone who had red grapes that were uncontracted had found it very difficult.
The grapes that haven’t been sold to a winery still need to be harvested, otherwise it can have an impact on the vine and crop for the coming year.
“If we may get some type of help … given the heartbreak that growers have gone by means of over the previous few months of not with the ability to promote their fruit,” Mr Derrico mentioned.
A spokesperson for the Victorian agriculture minister acknowledged winegrape growers were being impacted by global demand and supply chain challenges as a result of the pandemic.
“We’re working intently with growers and business teams to assist them to handle these impacts,” the spokesperson said.
Mr Derrico said his organisation had also requested support from the NSW government.
“At this stage plainly the NSW authorities would in all probability not present a direct monetary help to assist growers harvest their fruit, as a substitute referring growers to the agricultural small enterprise grants and rural help loans.”
