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Massive decline in winegrape harvest to wipe off wine stock overhang

Wine Grape Growers Australia (WGGA), is predicting that the 2007 vintage volume will be 40% or 800,000 tonnes lower than last year – a massive drought-driven correction in national wine grape production after three consecutive record or near-record harvests in 2004, 2005 and 2006.

The revised production estimate follows a WGGA review of the latest regional grower reports – based on early to mid season harvest yields. The predicted 1.2 million tonne vintage equates to a 400 million litre shortfall in the wine industry’s annual wine production requirement, and will all but wipe off the 460 million litres in uncommitted wine stocks reported last year.

WGGA predicts that current wine inventories will be exhausted in 2008, and that there will be a scramble for grapes by wine companies from all regions in coming weeks, with all fruit taken up by the end of the current vintage – albeit at still depressed prices. Combined with the continuation of low grape prices in the major production regions the sharp fall in yields will only deepen the economic plight of thousands of wine grape growers.

WGGA’s Executive Committee has expressed alarm at the continuation of unviable prices for 2007 vintage wine grapes, despite the very short supply of fruit this year – particularly in the major inland regions of Riverina (NSW), Murray Valley (Vic & NSW) and Riverland (SA), which account for 60% of national production.

WGGA Executive Director Mark McKenzie said there was now clear evidence of market failure in the wine grape market, which has remained at depressed price levels despite growing evidence over recent months of a serious production shortfall this year.

“Wine grape prices have failed to fully reflect the change in 2007 vintage production position or the prospect of a severely drought effected 2008 harvest – meaning the majority of growers were still being paid at below the cost of production. Bulk wine prices are improving, but most grape prices are not! Wineries must immediately lift grape prices to avoid a financial crisis in the wine grape sector. We are facing an exodus of growers that will simply perpetuate of the boom-bust cycle, and cost wineries far more in the long run!”



Roberts Real Estate


Bayer Teldor

Curtin University


WID 2016