Australian wine producers have pulled out more vines than they have planted, and within three years will be unable to meet demand, industry analysts say.

At the 2002 Australian Wine Industry Outlook Conference in Adelaide last Monday, analyst Lawrie Stanford warned of a looming grape shortage because producers have responded more rapidly than expected to the current grape glut, with lower planting and accelerated removal of vines.

‘In adjusting very quickly to the abundant supply, the industry may have over-adjusted, leading to the prospect of medium-term supply constraints,’ he said.

‘After a seven-year build-up in planting that peaked in 1998, the fall-away has been pronounced. Net planting has fallen to levels seen a decade ago, despite the fact that the industry is three times larger.’

In 2001 an estimated 6200ha of vines were removed, offsetting an approximate 8% (7120 ha) increase in plantings. ‘The latest information shows removals have rivalled new planting. As a result, net planting has fallen from the zenith of 14,000 net hectares in 1998, to less than 1000 net hectares in 2001,’ he said.

Stanford’s projections show the short term surge peaking this fiscal year. However, he also stressed the importance of recognising the three-to-five year timelag between planting, and vines becoming productive, and the possible effects of the drought currently experienced by much of the country.

‘Just as the response to red shortages five years ago led to the current supply overhang, the response to the current supply overhang has the potential to lead to a round of under-supply.’

Written by Tracey Barker11 November 2002