Riverland Wine Industry

Mr WHETSTONE (Chaffey) (15:16): I rise today to give an update on the Riverland wine industry. This week, we heard the government spruiking, saying that our wine industry is in good shape, but the engine room is not. They stated that exports of 11.8 million litres of wine went to China in November alone, valued at more than $93 million—that is $7.88 a litre—and that none of that is Riverland product. How do we fix the problem? We are seeing a global decline in consumption, particularly of commercial wine, and the Riverland is wearing the brunt of that decline.

The opinion of some in the Riverland's wine industry is that a mandatory code of conduct will fix the problem, but it will not. It will not address the long-term challenges within the commercial wine sector. Instead, wine grapegrowers must be honest with themselves and look to consider the level of structural adjustment within their business. They do not necessarily have to remove it all, but all their hard work and dedication to the industry must be recognised and rationalised.

However, they should look to include alternative commodities within their business model. I have witnessed what structural adjustment means to small family farms. Look at the Queensland sugar industry in Mackay. The corporates continued on their merry way, but the family farms did not have the deep pockets and they had to consider their options wisely. Currently, the state government is looking to buy 7,000 hectares of profitable prime ag land for housing. There is another opportunity for the Riverland to further diversify the management of their irrigated farmland.

Between 95 and 97 per cent of the Riverland's wine is exported as a bulk product. The consumption is in decline and the trend is also declining. The government's role is to provide an education service on a viable alternative. It is about helping struggling growers to make informed decisions, and the current management regime of vineyards and vineyard properties is entirely in the hands of horticulturalists in the Riverland.

But we cannot keep doing more of the same and expecting the government to fix the problem. It is the consumer who can fix the problem. Diversity in our trading countries, particularly India and Asia, is looking us in the face. If the wine grapegrowers continue to rely on government to solve their problems, they will continue to lose ground and continue to lose money.

There are economies of scale to make wineries more profitable, which can only mean more wine processed, and at the moment the more wine processed the less return to growers. It is all about supply and demand. Instead, growers might consider focusing on reward for effort for better quality varietals that are making returns. It is a variety versus varietal, a red versus white, decision to be made.

While small parcels of Riverland fruit are being marketed, patches of alternative fruit are paying dividends, particularly in the white varietals. I have concerns that the federal government's water buybacks continue to prey on the vulnerable Riverland wine industry. It only shrinks the local economy and decimates the viability of a local food and beverage sector. I sympathise with the growers wanting to sell their water for many reasons, but I say to them, 'Please consider selling your water to your neighbour or retaining it in the local distribution network within South Australia.' Once that water is sold to the commonwealth it is gone forever, that economy has been taken away.

Some say it is around the corner from the election. Some opinion pieces are hitching decisions made in a lead-up to an election and are using the local paper as a platform to blame others and direct others into a dark corner. Instead, we should be actively lobbying all levels of government and industry every day, all the time, irrespective of how far out from an election we are. I must say that I have travelled the corridors of power, no matter where, no matter when, to lobby in the best interests of the Riverland and its horticulture sectors.

Government reports and committee recommendations do not put money into growers' pockets. While we wait for the government to take action, wine grapegrowers continue to lose money and lose faith in the industry. Driving consumer demand is the only thing that will give lasting certainty to the commercial sector.

Sir, as you would well know, the wine industry has been through a very tumultuous and challenging time. It is time for those grapegrowers to make a decision. They cannot keep doing more of what they are doing and expect a different result. The world's consumption is in decline. The trend is that human consumption is becoming less and less. There are more challenging commodities within the beverage sector that are forcing those Riverland irrigators, those Riverland winegrowers, to make a decision and make it soon.