Bushfires: Winemakers fear smoke damage

Graeme Shaw is one of many smaller Australian winemakers who are watching to see what ­impact the bushfires will have on their business.

Although his property at Murrumbateman, 30km northwest of Canberra, was not directly affected by flames, unlike the vineyards of the Adelaide Hills, it was affected by smoke.

“We are getting second-hand smoke from the fires far away from us,” he told The Australian on Thursday.

“We are watching it carefully and have done some testing (for smoke damage).

“We are not seeing any negative signs here but there are a few down the south coast which have been burning.”

Winemakers in the Canberra area have had discussions about the potential impact of smoke on their vines, while some in NSW’s Hunter Valley have begun testing their grapes.

But as the bushfires continue, with vineyards in other parts of rural NSW and Victoria and South Australia directly affected, Shaw is concerned about the longer-term impact on small winemakers in Australia.

While Australia’s city dwellers may get their cut-price wines from giants such as the Woolworths-owned Dan Murphy’s, the country’s smaller wineries rely on regional tourism for their sales.

Shaw has been active in getting Chinese tourists to visit his property on their way to or from Canberra and has begun making regular visits to China to sell his wines directly to restaurants and high-end consumers.

But he says one of his big concerns is the international publicity over the fires that will keep people from visiting Australia, particularly rural areas.

“We are sitting down now and working out what we can do to maintain and build our visitor numbers,” he says.

“It’s going to be a challenging year for everyone.”

Shaw believes regional tourism in areas affected by the fires will be hit hard, long after the bushfires are over.

“There’s going to be a real flow-on impact from the fires into the regional tourism industry,” he says. “It’s a real worry. Unless we can get the regions back up and healthy, the whole economy is going to suffer.”

Shaw says there are also stories emerging of other farmers in ­regional Australia, particularly fruit growers, who wonder if they have the energy to undertake major replanting exercises that can take years to become profitable.

In the Adelaide Hills area, the wine industry is now assessing the extent of fire damage.

More than 30 per cent of the region’s vineyards are located in the fire area.

Kerry Treuel, the executive officer of the Adelaide Hills Wine Region, says the impact of the damage is yet to be determined.

“Unfortunately some vineyards are completely gone but there other areas where vines are still intact with no signs of fire damage,” she says.

“More than 60 grape growers, producers and wine businesses have been adversely affected in one way or another.

“The flow-on effect of a disaster like this will certainly be felt by many for years to come.”

ASX-listed winemaker Australian Vintage, which owns three vineyards in the Adelaide Hills area, said this week its 30ha Charleston vineyard had been affected by the fires, with an estimated loss of about 200 tonnes of grapes.

“We are still assessing the impact on our Adelaide Hills third-party growers,” it said in a statement this week. “Taking into account the Adelaide Hills fire has potentially wiped out a third of wine production in this area, AVL has been fortunate it only sustained minimal direct damage.”

In NSW, the winemaking area of Tumbarumba, on the western foothills of the Snowy Mountains, is still battling fires.

A winemaker in Tumbarumba said on Thursday: “I know you have to do your job, but I have fires all around me and I have to go.”

Shaw estimates it can take as much as three years for vines that have been completely destroyed to be replanted and produce a new crop and longer before it could become a more commercial crop.

In a narrow sense the bushfires have only affected a small percentage of the total winegrowing area under cultivation across Australia.

Wine Australia estimated that to date a maximum of 1500ha of vineyards are within fire-affected areas.

“Even if all those vineyards were fire damaged — and they are not — it would only be about 1 per cent of Australia’s total vineyard area,” said Andreas Clarke, Wine Australia’s chief executive officer.

But the wine industry is a microcosm of many regional small businesses that have been hit by the fires and still not sure how much the damage will be in the short term and long term.

Australian Grape and Wine chief executive Tony Battaglene says the biggest concern for the industry is the potential damage from smoke on the grapes.

“There is a lot of testing going on,” he says.

Wine Australia has done a lot of research into the effect of smoke on grapes. The closer the smoke is to the time when the grapes are ripening, the more damage it can do to the crop.

He says the biggest focus has been in the Hunter Valley where the grapes are now ripening ahead of the picking season, which starts later this month.

“If the grapes are found to have smoke damage, they don’t get picked,” he says.

He adds there is also concern that vineyards in Victoria could find their grapes smoke affected and many growers may not be able to sell them.

Battaglene says the smoke in Sydney and Canberra has been worse than pollution he has seen during many years of travel in China, now the biggest export market for Australian wines.

He estimates there are some 3000 wineries around Australia.

At the one end are the big wine companies such as Treasury Wine Estates, at the other end are small mom-and-pop businesses such as Shaw Wines, which makes 15,000 cases a year.

Battaglene agrees with Shaw that the impact on regional tourism will affect the business of the smaller wineries. “Smaller producers find it hard to get into the supermarkets. They rely on regional tourism and local sales.”

The wine industry has always been a tough one in Australia subject to natural disasters, changing market demands and intense competition.

This week saw the voluntary administration of family-owned McWilliams Wine Group.

Shaw is one of the few smaller winemakers in Australia who have jumped on a plane and pitched their wines directly to the Chinese market.

He estimates that he now sells 20 per cent of his produce to buyers in China.

He was recently able to do a wine tasting at the home of a well-connected Australian in Beijing, which has seen him put 1700 cases of wine into containers for two clients in the Chinese capital.

The growing demand from Chinese consumers is helping underwrite the health of major wine companies such as TWE.

At this stage, the bushfires are not going to be a major blow for the Australian wine industry, but it will take some time before grapegrowers and regional winemakers can assess the full impact of any longer-term damage to their business.