Wine grape growers demand safeguards for industry in ‘crisis’
Growers in Australia’s largest wine grape regions are calling for the federal government to implement a mandatory code of conduct as soon as possible to stop a mass exodus from an industry in “crisis”.
The final report from a Senate inquiry into the industry was released on Friday, recommending earlier indicative pricing and a binding dispute resolution process.
The mandatory code would be enforced by the Australian Competition and Consumer Commission (ACCC).
Growers have been receiving prices below the cost of production for some wine grape varieties. (ABC News: Dominique Schwartz)
The committee also recommended that the federal government investigate potential support packages to help growers transition out of wine grapes and into other crops or land uses.
‘Don’t want to do this anymore’
Jack Papageorgiou has been growing wine grapes in the Riverland for more than 50 years, and said morale is so low among farmers like himself that many doubt the changes will be adopted.
Grower Jack Papageorgiou says he has little confidence the report’s recommendations will be adopted. (ABC News: Jessica Schremmer)
“Politicians don’t listen to the growers on the ground … to understand the impact they’re having,” he said.
“There’s a lot of grape growers that don’t want to do this anymore.
“There needs to be an exit package so people can leave this industry with some dignity.
“My wife had to pull out $150,000 in super to support the farm. You can’t do that year after year.“
Grower Amanda Dimas says the inquiry’s recommendations are “a major turning point” for wine grape farmers. (ABC News: Shannon Pearce)
Amanda Dimas presented at the Renmark Senate inquiry hearing among other growers who made emotional pleas for a mandatory code.
Without a legally binding code, they warned many farmers wouldn’t survive the next vintage.
For the past four years, wine grape prices have sat hundreds of dollars below the cost of production per tonne.
Ms Dimas said the inquiry’s recommendations were a major turning point for the Riverina, the Riverland and the Murraylands but the changes needed to be implemented “as soon as possible”.
“We couldn’t be happier with this … the prices coming out earlier will mean we can budget and run our business to the best of our ability with information at a reasonable time,” she said.
“The mandatory code holds everyone accountable for their actions. Whether a big grower or winery, the balance is restored.“
But with the wine industry struggling, she said growers should not be made to wait.
“We need this put in place as soon as possible,” she said.
“We need information as early as possible in the interim, we need to know how much we are looking at for grapes.”
Some growers have given up and walked away from their vineyards. (ABC Riverland: Will Hunter)
Vintage usually starts in January but for years growers have battled to get finalised prices from wineries, with some only receiving prices during harvest.
Similar Senate inquiries in 2005 and 2016 backed a mandatory code, and both failed to be endorsed by government.
Wine Australia data shows the industry contributes over $45 billion annually to the country’s economy.
About 6,000 wine grape growers employ 163,790 workers across Australia.
Growers battle for survival
Riverland farmer Mintu Brar has been operating at a huge financial loss for the past four years due to low prices.
Riverland farmer Mintu Brar says he has been forced to rely on his son to pay the bills. (ABC Riverland: Shannon Pearce)
He said his production costs were a minimum of $300 per tonne but he only received $125 per tonne from the winery.
Mr Brar is yet to receive finalised prices for some varieties of grapes from the winery he supplies, despite being halfway through vintage.
“In my scenario my son is feeding me … I might have to decide to quit growing,”
Mr Brar said.
Despite being mid-vintage, some growers still don’t know how much they’ll get paid for some varieties. (Landline: Kerry Staight)
He said the pressure was felt by the entire community in Australia’s largest wine grape growing region.
“Only hope is making us survive,” Mr Brar said.
Riverina Winegrape Growers chair Bruno Brombal said the situation is just as dire in the Riverina region of New South Wales.
Grower Bruno Brombal says about 3,000 hectares of vines have already been pulled out in the Riverina. (ABC Riverina: Emily Doak)
“We know there are growers on a 20-hectare farm losing between $50,000 and $80,000, and if you’ve got a bigger farm, you lose more,” he said.
He estimated that around 3,000 hectares of grapes have been pulled out already and a couple thousand more could be removed this year.
Industry open-minded
Australia’s winery landscape includes major global wine companies such as Accolade Wines and Treasury Wine Estate, alongside medium to small businesses.
Australian Grape and Wine (AGW) said the critical issue for the sector continue to be the “supply and demand imbalance which is driving down demand and prices for grapes”.
“We need urgent assistance for growers and winemakers to grow demand at home and abroad, while carefully going about facilitating the structural change we need to see with regards to our supply base,” it said.
Australian Grape and Wine says supply and demand imbalance is driving down prices for red wine grapes. (SUPPLIED: Photo by Kelsey Knight on Unsplash)
Treasury Wine Estates (TWE), which owns well-known labels such as Penfolds, Pepperjack, Wolf Blass and Lindemans, said it is committed to fostering “strong, long-term partnerships with [their] growers” and is “open-minded” to a potential mandatory code.
“If introduced, [it] should be through a collaborative process, so that everyone’s voice is heard,” a TWE spokesperson said.
Accolade Wines, which produces Hardys, Grant Burge Wines, St Hallett and Banrock Station, declined to comment in the time given.
With a federal election to be held by May 17, the decision to endorse a mandatory code of conduct is in the hands of the government.
