19/12/2024
Are we looking at the end of wine production in the Riverina MIA
An Open Letter to Government and the wine Industry part 2 Solutions
Government Intervention
Federal Government
The decision by the federal government to ignore the 2024/25 prebudget submission by Australian Grape and Wine should be revisited, especially the $30 Million allocated for growers to move out of the industry to bring it back into balance. These figures pale into insignificance compared to a 600 million deal to give Papua New Guinea a spot in the Australian Rugby League. Unfortunately, you were wrong in thinking that China would fix the industry as can be seen by prices that continue to drop or remain less than the cost of production, with warning by the wineries that they cannot see an end to this soon.
Secondly you need to make a one off purchase of aging unsaleable wine that is depressing the bulk market rendering supply and demand obsolete, this wine is in storage with no way to get rid of it, as to let it go down the drain would cause environmental issues and fine from the EPA. It could however be distilled into ethanol; this system has been used in both France and Spain recently.
Interest rate relief, a lot of our members have debt that they cannot service, recognition of this by way of interest free loan would help a lot of families breathe a little easier especially with the rate of inflation in the past couple of years. We are aware of the Farm Household allowances, and while this initiative is great, it still needs some work as the amount of effort required to obtain it adds to the pressure put on already overburdened families. The system has previously left recipients regretting the choice to join due to the long-term ramifications they faced as being part of the scheme, and the conditions also need to reflect the real needs and realities of being an Australian farmer. RIC loans are just not suitable for this situation as they are meant to assist farm businesses to remain profitable and grow, when you are being paid below the cost of production for your produce you can’t service the debt that you have let alone take on another loan.
A mandatory code of conduct that starts with the grower and ends with the retailer, the present voluntary system pits growers against wineries, while wineries suffer the same issues at the hands of the retailers. Under the present system signatories released their prices last Wednesday and if last year is anything to go by, these prices are likely to be significantly more especially reds varieties than the non-signatories who will not release prices until days before harvest commences. These wineries get to see everyone else’s prices before releasing their own, and some have payment terms that will see some of next year’s crop being picked before last year’s is fully paid for. This sort of conduct is a disadvantage to the wineries doing the right thing, one small improvement was announced by Australian Grape and Wine at the last One Sector Plan conference being the inability for a non-signatory to the code of conduct to be able to utilize the sustainability certification for their products.
Disaster assistance for growers, it’s not just the markets that are working against us. Mother nature has done her best to add to the issues that already overburdened growers are experiencing. Just this year alone we have witnessed the worst ever frost the region has seen in living memory, followed by the worst wind/hailstorm that I have seen hit Yenda and surrounds in the 30 years that I have lived in the area. These storms add cost to an already over committed budget and add to the mental burdens that these growers must carry, which is distressing to see at best and at worst will see us lose members of our community in the worst way possible.
State Government
You also need to step up to the plate where disaster assistance is required, as this is a joint initiative between the NSW and federal governments. We also need your support for a mandatory code of conduct for the benefit of the whole industry, we need to see our politicians working for the people they represent even if we are a minority of only 225 growers as is the case today, it’s likely to be a lot more next year.
We have spoken to the state minister for agriculture before about passing laws to protect growers as they have in SA. This law stops wineries from procuring grapes if they have not finalized payment for the previous crop. At the time the minister was horrified that this had happened, but we have seen no change, and the problem continues to happen.
We need more support personnel in the DPIRD. When I started this role just under 3 years ago, we had 3 development officers for Viticulture with 2 based in Orange and 1 in Griffith, now we only have one who is based in Orange. We rely on these people to provide support for our industry by way of research, extension and industry engagement. Just when we need that support the most, like we did this year and will again next year as we move to get growers over the line with sustainability credentials, it is nowhere to be seen. We must take whatever support we can get and while the current development officer has been fantastic it is still not enough as she can’t be everywhere at once and we have a large state with many wine regions. We would also like to make sure that the DPIRD continues in the R and D Space, as we need to be able to contribute to national R and D projects as well as ground truth work done in other areas to make sure that it will work for us commercially.
It would be great to see the NSW government support our industry by only sourcing only NSW wine for official functions, and by not considering a container deposit scheme for wine. As these costs will likely be pushed onto growers, or cause price rises in wine that would see wineries lose market share.
I would urge both the federal and state governments to listen to our pleas for help and that a leadership role to intervein before we start to lose people, I look forward to seeing help for our industry that is far from fixed even with the return of China as an export market.
Yours faithfully
Jeremy Cass
CEO
