Who would have thought? After years of the relentless message from New Zealand Winegrowers that the world just can’t get enough Marlborough sauvignon blanc, a couple of large vintages and the whole thing goes pear-shaped. Could there really have been no risk management policy whatsoever? Perhaps not - I find myself wondering just how ostrich-like is CEO Philip Gregan with his recent comments that New Zealand is the “envy of producers worldwide”. Presumably one part of New Zealand Winegrowers’ job is to be industry cheerleader but when the Marlborough Express is reporting winegrowers seeking help from WINZ to put food on the table (at least they have plenty of sauvignon blanc grapes to nibble on), long-established, well-respected labels are heading towards receivership, the industry is grossly over-dependent on one variety and region and there is currently more wine sloshing about that anyone knows what to do with, it is hard to see what’s to envy. Fair enough, it is currently a tough market worldwide and there is also no sense in knocking people when they are down, but surely it is Gregan’s job to guide the ship through troubled waters as well as smooth – and therefore less Pollyanna and more realism and clear-headed strategy about how to actually achieve that putative goal of focusing on the top end of the market would be helpful.
The wine industry’s growth may indeed have been spectacular over the last twenty years but it is difficult not to feel slightly alarmed when one looks closely at the figures and realizes how much of that growth is made at a loss and how few producers have healthy balance sheets (let’s face it, not helped by NZ Winegrowers’ ‘the market will never get sick of this wine at these prices!’ attitude helping to lure all manner of opportunists and naïve optimists to try their hand). Gregan’s comment that "We might not like the price that some of it is being sold at but 30 per cent growth is good news.", does not inspire confidence. I am no economist but even I can see that if the producers aren’t actually making any money, then it doesn’t matter how good the growth is because sooner or later they will have to pay the piper. Germans and Australians have found out just how slippery a slope basing the drivers of their industries on low price/high volume can be. It is hardly the foundation on which to cement a high quality long-term, world-class industry and Michael Cooper’s Listener puff piece on NZW not withstanding, it is a sobering thought in these tough times if this is the best our industry body can come up with.
(EJ)