Drought may slash Australia's 2008 vintage

Australian wine looks likely to be hit hard by the country’s relentless drought. Results from the industry’s Drought Taskforce suggest that the 2008 grape harvest could be more than halved, according to the Winemakers’ Federation of Australia (WFA) and Wine Grape Growers’ Australia (WGGA). Estimates are for a fall of between 800,000 tonnes and 1.3 million tonnes. This compares with normal seasonal conditions that would see a crop of around 1.9 million tonnes.

Mark McKenzie, executive director of WGGA, said, ‘We know for certain that yields will be down dramatically in those regions relying heavily on irrigation water from the Murray Darling, particularly the Murray Valley and Riverland, where water allocations for high-reliability water are currently 10 per cent and 16 per cent of full allocations.’

Since these areas mostly produce Australia’s high-volume varietal wines, one wonders whether the end is looming for the low-cost imports countries like the UK have enjoyed for a decade or more.

Certainly, WFA chief executive Stephen Strachan believes, ‘Wine companies will seek to protect their established and high-value brands and will divest lower profit product, particularly the surplus-induced distressed sales that have been evident over the last couple of years.’

Big Australian brander Foster’s has made contingency plans to source from Chile, South Africa and maybe even Argentina in case the small crop leaves it with a shortfall of grapes. The company, whose brands include Lindemans, Rosemount and Wolf Blass, doesn’t expect the shortage to be critical, but says in order for the company to grow, it may need to look elsewhere.