Vineyards sold for housing development

Wine Grape Growers’ Australia Executive Director Mark McKenzie said in October 2009 that a large percentage of the grape growing and winemaking community was in severe financial stress. “We have at least 20,000 ha of vineyards more than we need,” Mr McKenzie was reported as saying. The wine industry needs to cut at least 10 percent of Australia’s 177,000 ha of vineyards from production, he said.

According to Mr McKenzie, Australia is producing 20 million to 40 million cases a year more than it is selling. This is roughly equivalent to total sales to Australia’s second largest export market, the UK.

The crisis has been exacerbated by an export market crash. Some salient statistics: in 1985 Australia produced 336 million litres of wine and exports were worth AUD 30 million (EUR 18.6 million); this year production was 1.4 billion litres and exports worth AUD 2.35 billion/EUR 1.5 billion (year to October 2009), down from a peak of AUD 2.98 million in 2006/2007.

The rising value of the Australian dollar is also making it difficult to sell wine to major overseas markets.

Mr McKenzie said the outline of a Wine Industry Restructuring Action Agenda was presented to the Federal Government by four major national wine organisations, the Winemakers Federation of Australia, Wine Grape Growers Australia, the Australian Wine and Brandy Corporation, and the Grape and Wine Research and Development Corporation, at the end of October 2009.

“The Government has made it clear they won’t get involved in an old-style vine-pull scheme,” Mr McKenzie said.