Unlikely as it might seem to those who gather their wine information from uninformed sources, a shortage of shiraz grapes in Australia is imminent. Surveys in the large inland wine regions suggest a potential shiraz crop in 2004 around 30,000 tonnes short of wineries’ preferred intake levels. OnWine has steadfastly and consistently rejected the scaremongering of business columnists concerning the so-called oversupply of winegrapes. In fact, the wine industry now recognises that without significant further plantings of vineyards, it could well experience fruit shortages within a few years. However industry profitability has fallen from a return on winery investment of 7.6% in 1997-98 to 4.2% in 2000-01, so those who plant these vineyards will be doing so under a very different set of economic expectations from those who planted during the boom period between ten and two years ago. Factors such as the rising Australian dollar, global oversupply (especially in the US) and a trend towards drinking European wines in the UK haven’t exactly helped the situation here. The industry’s challenge is to develop sufficient incentive for people to meet its future grape demands. I expect this might involve a re-think about the value of creating and adhering to grape supply contracts.
