AN HONEST CONVERSATION ABOUT WINE

AN HONEST CONVERSATION ABOUT WINE

Much of the conversation around the crisis facing wine grape growers in the Riverland has been focused on a mandatory code of conduct to ensure fair trading terms.

I’m certainly not opposed to mandating a code of conduct, or the inclusion of indicative prices to assist grape growers make decisions in a timely manner during the growing season. However, a mandatory code will not be the silver bullet some in the community are suggesting it will be, and it is disingenuous, bordering on cruel to suggest that it will.

The uncomfortable truth is that global supply, particularly red varieties, far outweighs global demand for that wine.

We know that globally, consumer trends have changed.

Consumers are abstaining from alcohol or moderating their intake and while alcohol consumption in general is declining almost universally across the globe, most of this decline is due to a decrease in wine consumption specifically.

In short, we cannot trade our way out of this problem. The demand is not and will not return to pre-covid levels any time soon.

We can improve trading terms for growers, but the reality is that grape prices, regardless of when they are known, are unlikely to rise above the cost of production until we reduce supply to meet the shift in demand.

The only way to ensure the inland wine sector can recover to a sustainable level is to reduce production volumes. Mandatory code or not.

Understanding that growers are under extreme financial pressure and have been for some years, I suspect there are very few with the capacity to transition, either entirely or partially, to other crops. Pulling vines, the disposal of posts and the associated irrigation infrastructure as well as cash flow issues awaiting a new crop to come into production, is understandably an overwhelming prospect.

The reality is, there is a role for government in helping growers through the necessary structural adjustment and governments at State and Federal levels have failed to react in time to avoid the worst pain I’ve witnessed in the Riverland wine industry in my time as the Member for Barker. 

It should be some comfort to growers to know that this pain has been heard and documented by the Senate Committee. It is also important to note that the Committee recommends investigating potential support packages to aid growers in transitioning out of wine grapes to alternative or complimentary crops. This is what I have been calling for, for 3 years.

I want to see a productive horticultural sector in the Riverland that continues to support a thriving small business community, a growing population, rich community connections and everything that comes from that.

To achieve this, we must do all we can to avoid a spread of unproductive blocks, lost jobs and the inevitable economic decline associate with the same.  

This means ensuring the volume of grapes produced within our nation’s inland wine regions is in harmony with global demand for the bulk wine these regions produce and ensuring a greater diversity of horticultural offerings emanating from these regions. 

A mandatory code of conduct would be welcomed, but it’s not a silver bullet and it should not be our immediate focus.

Support to transition should be.