Policy and Issues » Hot Issues
COVID-19 and bushfires have placed unprecedented challenges in front of winegrape growers and winemakers. Recovery is likely to be slow, and investment in the domestic market, tourism and exports will be required to help businesses bounce-back. Australian Grape & Wine will continue to work with Government and advocate for support to keep our sector viable in the face of what is likely to be a severe and potentially long recession.
It’s also a global problem. The International Monetary Fund has reassessed the prospect for growth for 2020 and 2021, declaring that we have entered a recession as bad as or worse than 2009. The COVID-19 pandemic is inflicting high and rising human costs worldwide, and the necessary protection measures are severely impacting economic activity. As a result of the pandemic, the global economy is projected to contract sharply by –3 percent in 2020, much worse than during the 2008–09 financial crisis. The Government will need to pay for the stimulus measures it has put in place and the first response will be for business to pay through increased taxes.
With so many competing priorities over the next twelve months, we have to be relentless in making sure grape and wine businesses are front-and-center in the Government’s considerations, to make sure we protect our interests.
The recent decision of the Australian and New Zealand Ministerial Forum on Food Regulation to request a review of the proposed pregnancy warning label designed by Food Standards Australia-New Zealand (FSANZ) was welcome. This decision reflected the strong advocacy work Australian Grape & Wine had undertaken in recent months to highlight FSANZ’s bureaucratic overreach and how the unjustifiably costly label proposed would hurt Australian wine businesses and employment across rural and regional Australia.
Pregnancy warning labels are just the latest example of bureaucratic overreach that is targeting draconian regulatory responses to satisfy the anti-alcohol lobby. The next target is energy and ingredient labeling. The views of anti-alcohol lobbyists must be effectively countered and Australian Grape & Wine will be working with government to ensure the policy agenda is balanced, based on evidence, and takes the enormous economic and social contribution of grape and wine businesses into account.
Alcohol and Health
COVID-19 has flushed out the anti-alcohol advocates who are using this opportunity to argue for tighter and stronger restrictions on the sale and marketing of alcohol. The growth in power and reach of the anti-alcohol lobby and its determined efforts to eliminate alcohol, including wine, as a legitimate part of Australia’s culture is alarming. These groups are well-funded and media savvy, and while most Australians believe their views are alarmist in the extreme, they are clearly making in-roads in the policy debate.
Australian Grape & Wine remains committed to working to achieve a safe drinking culture in Australia. We work with the Federal, State and Territory Governments, and other members of the alcohol beverage industry, to help design targeted, evidence-based policies that aim to reduce the level of dangerous drinking.
Like you, Australian Grape & Wine firmly believes drinking wine in moderation is in Australia’s social fabric, and can be part of a balanced lifestyle. We also understand the immense contribution our sector makes to rural and regional economies right across Australia, through jobs, tourism, hospitality and regional exports. Without a united, coordinated and rational response to the extremist views of the anti-alcohol lobby, we risk being regulated out of existence.
Winegrape grower advocacy
COVID-19 and bushfires have affected the whole sector indiscriminately. Australian Grape & Wine has been working for the benefit of winegrape growers during the current turbulent times. As well as taking part in a round table to secure financial assistance for the many vineyards and wineries impacted, we are collaborating with Wine Australia and supporting the excellent work done by the AWRI in arranging fruit analysis for smoke taint, and webinars to provide valuable information about vineyard recovery after fire.
We are currently in consultation with AWRI to produce a series of webinars and protocols focussing on pruning and vine training to combat the restrictions implemented due to COVID 19. The webinars will be available to whole of industry and released to state and regional bodies and available on our website in the coming months.
Growers and winemakers are working together to improve the Wine Industry Code of Conduct following the release of the ACCC Market Study into the Wine Grape Sector . This work is being done to ensure a high standard of commercial trade across the entire sector.
Increases in trade, passenger movement and wine tourism mean that biosecurity risk to the wine sector are rapidly escalating. Australian Grape & Wine’s goal is to future proof the sector by improving our capacity to respond quickly and effectively in the event of a pest or disease incursion. We will do this by raising awareness of biosecurity practices that can be practically implemented by winegrape and wine producers, and by advocating for appropriate levels of government control that consider both the benefits and costs to industry of intervention.
Unwanted pests and diseases are capable of causing significant damage to our vineyard assets. It has been estimated that the economic impact of bacteria Xylella fastidiosa (the cause of Pierce’s Disease in grape vines) could cost the Australian wine sector $7.9 billion over 10 years. As well as destroying vineyards, pest and disease outbreaks often trigger regulatory controls that can disrupt the entire wine supply chain, imposing substantial extra costs on grape and wine producers particularly in cases where an outbreak occurs during vintage.
Australian Grape & Wine will continue to collaborate with Plant Health Australia, Vinehealth Australia, supply chain businesses and other government agencies to mitigate risk and implement procedures if an incursion occurs.
Protecting our Environment
Australian Grape & Wine represents the best interests of grape and wine producers on issues such as energy, waste, climate change, biodiversity, environmental assurance and sustainable pest and disease management. We support winegrape growers and winemakers to demonstrate and continuously improve their sustainability credentials.
Environmentally sustainable production is an essential precondition to an internationally respected wine sector and Australian Grape & Wine advocates for research and policy that supports the ability of businesses to improve their environmental credentials. We oversee Australia’s national sustainability program, Sustainable Winegrowing Australia, through our Sustainability Advisory Committee, and along with AWRI, have recently co-invested in the development of a sustainability Trustmark.
We keep our members informed of emerging challenges relating to environmental policy. Our goal is to advocate for evidence led, risk-based decision making by government that promotes a profitable and environmentally sustainable sector.
Australia’s winegrape growers must continue to strive for improvements in water use efficiency. Ensuring healthy and sustainable water resources across Australia is a shared responsibility across industry, government and the community. Our aim is to ensure that water policy decision-makers give appropriate consideration to the economic, environmental and social impacts of their actions. We advocate for policies that support the security and long-term viability of the wine sector. In doing so we highlight grape and wine producers’ contribution to jobs, economies and regional communities.
A significant majority of Australia’s grape and wine producers rely on the health of the River Murray to ensure sustainable water supply for irrigation. As well as the major wine regions along the river in NSW, Victoria and South Australia, other regional grape growing communities use water from the Murray Darling Basin through pipelined supply. The Murray Darling Basin accounts for about 80% of irrigated grape production in Australia with 60% of grapevine area being in the basin itself. Water recovery, particularly in the Murray Darling Basin has put significant upward pressure on water prices, especially during periods of drought. While those who own and trade their water rights may enjoy the benefit, those who purchase temporary water face a significant cost burden that is likely to threaten winegrape supply.
Water availability risks are rising across irrigated agriculture. As businesses compete for a reduced and less reliable consumptive pool of water, many sectors are undergoing intensification with regions potentially becoming less diverse.
Our advocacy supports the security of the wine sector’s access to reliable and affordable quality water. This means fair and open water markets, enforcement of compliance by State jurisdictions and provision of adequate and timely information to irrigators. Where government decision making impacts on water availability, these decisions must be evidence-led, those affected must be part of this decision making and the pace of change must allow for adaption.
Code of Conduct
Through its Code Management Committee Australian Grape & Wine supports the Australian Wine Industry Code of Conduct, thereby promoting successful grower/winemaker partnerships and the prosperity and long-term viability of the entire wine sector.
Successful relationships between winegrape growers and winegrape purchasers rely on trust and respect on behalf of both parties. The Australian Wine Industry Code of Conduct aims to provide a foundation for building these types of relationships so that partnerships are fair, equitable and mutually beneficial.
A new Code committee was appointed in 2019 comprising equal representation from winemakers and growers. The committee has undertaken to reinvigorate the Code, bringing it in line with a number of the ACCC’s 2019 Winegrape Market Study recommendations. Our advocacy has also contributed to significant positive developments in support of winegrape purchasing relationships particularly in relation to the provision of better market information by Wine Australia and development of resources to guide quality assessments by winegrape purchasers by AWRI.
More than 60% of Australian wine is sold in export markets. As such, the sector is highly reliant on maintaining competitiveness and access to existing and future export markets. Our aim is to ensure that the Australian wine sector is able to respond to customer demand for Australian wine exports by delivering substantial and meaningful improvements in market access.
We work to achieve significant new market opportunities by reducing trade distortions in global markets, driving regulatory harmonization, which reduces or removes barriers to trade, and reduces costs and red tape.
Through a strong network of international colleagues, we work collaboratively across a range of international forums, including both government and industry representatives, to ensure that the interests of our Australian grape and wine sector are represented.
With COVID-19 significantly slowing global economies and trade, some economies may begin to consider policies which implement protectionist measures. . This is a significant risk to a wine sector highly reliant on international trade. Therefore, more than ever, it remains critical to have strong international networks to draw upon to help dismantle trade barriers, maintain open trade and re-establish supply chains.
Geographical Indications protection and grape varieties
In recent years, the European Union and some of its member states have invested heavily in protecting Geographic Indications (GIs) through trademark applications, applications for GI protection and Free Trade Agreements. At the heart of this issue is the fact that a number of terms for which protection is being sought, are grape variety names, common English words or other terms which, if protected, would restrict Australian producers’ legitimate rights to use those terms, in both the Australian and export markets.
In the past two years alone, European Union trade negotiations in China, Japan, Mexico, Brazil Argentina, Paraguay, Uruguay, Vietnam, New Zealand and Australia have seen attempts to protect an expanding number of grape variety names as European GIs, meaning they would have exclusive rights to their use on a wine label. These include Prosecco, Montepulciano, Fiano, Barbera, Vermentino, Alicante Bouschet, Dolcetto, Nero d’Avola and others.
Australian Grape & Wine supports protecting legitimate GI rights that have clearly defined rules around how terms can be protected as we have in Australia. We fight against illegitimate attempts to use GI protection to distort the market to the trade advantage of others. It is critical that we gain your support to fight against recent efforts to muddy the waters of our GI system and ultimately restrict your ability to legitimately use a range of grape variety names or common English terms.