Chinese poised to snap up Australian wine industry bargains
on 21/04/11 at 9:21 amIndustry
A wine industry advisory firm warns overseas buyers, especially from China, are queuing up in expectation Australian grape growers are about to hit rock bottom.
A high Australian dollar, grape glut and a disease-affected vintage have pushed growers to their limits.
Industry adviser Toby Langley says overseas buyers are looking for bargains.
“There’s been a lot of Asian interest, we’ve opened an office in China to capitalise on Asian interest,” he said.
Mr Langley says some vineyards have halved in value over the past decade but investors think values will fall even further.
“There’s examples of vineyards that perhaps were purchased 10 years ago for $80,000 a hectare; that vineyard would achieve about $30,000 a hectare today so over a 10-year period it’s more than halved in value,” he said.
“I expect there’ll be more properties come onto the market after harvest because it just has been such a difficult year and I think it’s going to mean people will look at their numbers and say ‘You know, I just don’t think we can continue’ so prices may soften a little more, but we’re very close to the bottom.”
Real estate agent Peter Fairweather says families who have been growing grapes for generations are selling up, as are growers who bought at premium prices about four years ago.
He says the industry has not been in such bad shape since the vine pull program of the 1980s.
“I think that the marketplace, along with weather, along with the dollar, GFC (Global Financial Crisis) it’s all affected sales so probably [in] the last 30 years, 35 years, it’s probably been one of the hardest times we’ve seen,” he said.
After 61 years in the industry, Barossa Valley grower Leo Pech is selling his Tanunda vineyard.
“I have never seen the effects of downy mildew, powdery mildew and botrytis to such an extent,” he said.