Grievance Debate

Wine Industry

Mr WHETSTONE (Chaffey) (15:32): I rise to talk about the South Australian wine industry that is staring at a generational crisis as I speak, particularly commercial wine and the machinations that it is currently going through after the last three years of extraordinarily low prices, well below the cost of production and well below the cost of winemaking. What the industry is now seeing is a financial tsunami that is about to hit not only the industry but particularly the Riverland, which is the engine room of the wine industry, not only in South Australia but nationally.

What I have seen, over the period of time since 2020, is government interference and Chinese trade tariffs since November 2020. We are seeing that consumption is down by 7 per cent, year on year. We have also had government and industry telling wine grapegrowers to plant red grapes—to plant Syrah—to cater for the growing demand, particularly into China. Those Syrah grapes are now looking at fetching $80 a tonne. The cost of production is somewhere between $300 and $320, and so you can see why there is so much financial stress happening in the wine sector, most of all in the Riverland in the commercial wine sector.

What I must say is that the federal government is currently circling all those wine grapegrowers, hunting their water. That is a real concern because that water is the economic platform or the economic base for South Australia's food production economy. It is an economic base to what I consider to be the premium food bowl of South Australia.

I have written, as has industry, to the Premier and we have invited him to come up to the Riverland and visit. Come up and stare the wine grapegrowers in the eyes and understand the strain, stress, hardship and mental anxiety that it is causing a majority in the Riverland. Sixty per cent of the Riverland is reliant on the wine industry and it is really on its knees at the moment. There has been a 50 per cent increase in wine grapegrowers now receiving the Farm Household Allowance due to financial stress. That Farm Household Allowance is put there simply to allow those families to put food on the table and to allow them to get medical help or medical procedures if they need. It is a stopgap measure.

But what we are seeing now is that those growers, those irrigators, those wine grapegrowers are so financially stressed that they have sold their water entitlement. They have sold a lot of their equipment. They have sold anything to actually keep their heads above the waterline and that is of real concern. That is why today I make this grieve with serious consideration and the messaging to the Premier is to please come up and visit.

As I said, the Riverland is the engine room of the nation's wine industry. Seventy per cent of South Australia's wine is produced in the Riverland, 32 per cent of the nation's wine. Of that 20,000 hectares of vineyards, we are seeing large plantings now being removed to adjust to the decline in demand. What we have seen since 2022 is that we are reducing the tonnage, reducing the volume. It is down 19 per cent, but what that means to South Australia's economy is a 21 per cent reduction in South Australia's crush.

So, again, I am calling on the government to provide further support for mental health services. I am calling on the government to introduce no to low interest loans. That is of no cost to the taxpayer—none. It is about giving them the ability to structurally adjust, to either transition away from the wine sector or to be able to make their farm profitable so that we can continue to grow our economy, create jobs, keep the Riverland alive and keep it on the map.

The structural adjustment is the critical part of what the wine sector needs. The government need to provide data. They need to provide the information. They need to provide the education. They need to provide the confidence for the sector to structurally adjust and there is no more important time than now. So I am calling on Premier Malinauskas to please come and visit the Riverland. Bring your economists and bring your staff to the Riverland and please understand the hardship and the financial stress that these people are currently under because the wine industry needs you.