AGW calls for $86 million in pre-budget submission

Last week, industry body Australian Grape & Wine (AGW) wrote to Federal Treasurer Jim Chalmers with its pre-budget submission, calling for $86 million in government support to enable growers and producers to transition out of the industry. The submission included signatures from Treasury Wine Estates, Casella, Pernod Ricard Winemakers, De Bortoli, Hill-Smith Family Estates, Taylors, Calabria, Angove and Berton Vineyards, according to reporting by The Australian.

Lee McLean, CEO of Australian Grape & Wine, explained to The Weekend Australian that the group was seeking recognition that the main source of the industry’s recent economic woes was the trade dispute with China, something which McLean noted was “completely beyond our control”.

“We are making the case for intervention because this is not a normal market fluctuation we have seen,” said McLean. “The impact of the loss of the China market has had a sudden and profound impact. There are millions of litres of wine just sitting in tanks. It has been a devastating economic shock to our industry that was completely beyond our control.”

The $86 million package hopes to alleviate some of the pressure on growers and producers in the wine industry, with $30 aimed at tackling the oversupply in the industry, by financially enabling growers to transition to alternative crops or simply pull their vines and exit the industry.

The submission proposes that $36 million of the package be dedicated to supporting the industry’s exports, by discovering and expanding new markets.

Tim Ford, CEO of Treasury Wine Estates told The Weekend Australian that the budget submission could allow the industry to “refocus” on higher quality.

“You can say ‘let market forces be market forces’, but when you combine that with China, it requires a structural adjustment,” Ford told The Weekend Australian.

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