Unsustainable prices for grapes and an oversupply of wine has led to a real hardship in the grape-growing sector, with some growers getting about 15 cents a bottle for red wine. So what did the industry get in the budget? “Nada, zilch, nothing,” says wine writer RICHARD CALVER. 

There is real hardship in the grape-growing sector, something that Australian Grape and Wine (AGW) wanted the federal government to acknowledge and help to fix in the budget.

In its pre-budget submission, AGW was asking for $86 million in grants, in part to help some growers transition from the industry. 

They asked for a $30 million sustainability package, $36 million for export assistance and $20 million for domestic wine tourism. 

The sustainability package was labelled by AGW as enabling growers “who wish to exit the industry or change their business models to drive greater efficiencies and better environmental outcomes in a sustainable and dignified way.” 

Some growers are taking this step themselves; it has been reported that they are ripping out grapevines to plant medical marijuana and almonds.

AGW said that the $30 million could encourage certain investments including protected cropping, environmental plantings or modifying equipment or infrastructure for alternative systems to improve irrigation efficiency all with a view to encouraging those with an unprofitable business model to explore alternative crops or businesses.

On hardship, the ABC recently quoted one Riverina grape grower as saying that many growers in the district were receiving prices at about 15 cents a bottle for red wine: “The label’s worth more than that, the bottle is worth more than that… The container deposit scheme is, you know, getting close to what we’re making. If someone can take a bottle and put it in a bin and make what we’re making, it’s pretty sad.”

What did the industry get in the budget? Nada, zilch, nothing. 

“This budget provides no relief for the serious challenges facing growers and winemakers in regional communities across much of Australia,” said AGW CEO Lee McLean.

“The economic shock experienced by our industry has led to unsustainable prices for grapes, an oversupply of wine and increasing economic disadvantage in regional Australia.”

To make matters worse McLean added that “instead of support, all we got was a new tax in the form of the deeply flawed Biosecurity Protection Levy.”

The Department of Agriculture, Fisheries and Forestry explanatory material says that from July 1, the Australian government will introduce a new Biosecurity Protection Levy payable by producers. The levy will be payable in relation to agriculture, fisheries and forestry products or goods whether produced for the domestic or overseas markets, which includes wine grapes. The levy rates are being published in a staged approach. The first tranche of rates for a number of agricultural commodities is available but the list does not yet include wine grapes. 

I asked Fergus McGhie, president of the Canberra District Wine Industry Association, what the view was of the fact that the budget contained nothing for the industry. 

He said: “Canberra is a completely different scenario; our brand is held in high regard and consumers can’t get enough of our wine. 

“Any money that was in the budget should have gone to the growers in the Riverland and the Riverina where they are walking off their properties because they can’t sell their grapes at a fair price.”

McGhie also said that biosecurity is an extremely important issue for the industry and it is fair that the industry contributes something, although a new tax will be a burden on Australian winemakers who are all finding it difficult in the current economic environment.

“What is the difference between a taxidermist and a tax collector? The taxidermist takes only your skin.”–Mark Twain