Land for sale. Undulating north-facing site of 20 ha with 16 ha of cleared land in long parallel strips. Soil bare and infertile. Beneficiary of favourable water allocations which enable regular watering every two years, provided it rains in New South Wales. Main feature is established trellis system to which grape-producing* vines are attached. Will either require regular seasonal maintenance or an appointment with a bulldozer. *occasionally in a quantity sufficient to justify harvest A recent report in The Australian newspaper provided an alarming health check for the Australian wine industry by revealing that there are more than $450 million worth of wineries and vineyard land currently up for sale. The list of what is up for grabs ranges from major corporate developments to small ’boutique’ operations whose owners have seen the writing on the wall. More alarming still than the numbers themselves is the comparative lack of purchaser interest. It is nearly a year since Constellation Wines Australia put 23 vineyards up for sale, most of which remain on the market despite the company’s undertaking to maintain fixed contracts on the fruit of many. Facing its own restructure, Foster’s has listed an additional 31 vineyards for sale as it seeks to reduce its vineyard holdings by 30% or 4000 ha. It is prepared to attach supply contracts to most of these vineyards. Clearly, in hard times, vineyard ownership is more of a hindrance than a help on the corporate balance sheet. On the other hand, if wine producers lose control of key vineyard assets responsible for important wines, they could face trouble in future if competitors outbid them for access to important fruit. The difficulties faced by companies attempting to sell vineyards in an over-supplied market could also diminish the value of the vineyards they retain, which in turn could force more vineyards to come up for sale if assets are devalued. It’s potentially a very dangerous cycle.
