Growers feeling the pinch

Grapegrowers have this year been hit by a triple whammy a drop in income, a reduced harvest and increased vineyard management costs.

Incomes from this year's sauvignon blanc harvest fell from a peak $2363 per tonne in 2008 to $1650/tonne this year a drop of $713/tonne. The figures are based on averages from vineyards monitored by the Ministry of Agriculture and Forestry.

New Zealand Winegrowers chairman Stuart Smith said $500 per tonne was the lowest price to appear in industry statistics. Rumours of less being paid were an "urban myth", he said.

Wine companies required that sauvignon blanc fruit be thinned to radically reduce cropping levels. Industry sources suggest many growers were forced to reduce crops by about 2.5 tonnes or more per hectare (0.45 hectare), depending on the company they were contracted to and the site.

At $1500/tonne for sauvignon blanc, after thinning there was "virtually nothing left" in the hand, one grower told The Marlborough Express.

Not only did thinning reduce crops, but it was very costly.

Traditionally, only high-value varieties were thinned.

A major fear is the rising New Zealand dollar which hit US70.88 cents last Friday and has remained at about the US70c mark. Twelve months ago, the New Zealand dollar was worth US65c.

"The dollar is predicted to go higher yet, which will, of course, mean lower returns," said Mr Smith.

On the positive side, interest rates were relatively low.

What many growers spoken to by The Express are hoping for is a "not in my vineyard" frost or late-flowering scenario to tip the supply-and-demand balance back in their favour.