Tuesday, 19 February 2019
Wine Australia Amendment (Trade with United Kingdom) Bill 2019; Second Reading
I'm glad to be able to stand and speak about the Wine Australia Amendment (Trade with United Kingdom) Bill 2019, even though it's non-controversial, because it does give me a chance to talk about wine exports and what they mean for regional electorates like my own. It also gives me the chance to raise, again, the challenges we have with one of our very popular varieties, which is only grown for prosecco. Prosecco has become a bit of a hit and is currently taking off in the UK, but our growers and winemakers have hit a bit of a hurdle. An area in Italy has decided to rename the region Prosecco and, like Champagne, is claiming that Australian winemakers can no longer use that name for the variety on their labelling. That of course would be disastrous for our local wine industry.
When you meet the King Valley winemakers you find they are passionate about their history. They are passionate about their wine but also about their wine history. They imported this particular grape variety, and it said on the importation papers 'prosecco variety'. They've won this dispute at the WTO and in every other economic forum, but now we have the Italians trying to be quite cheeky and push for this in the Australia-EU free trade negotiations. I hope the government are being true to their word and continuing to stand on the side of the Australian winemakers to try to stop that happening. It's not necessarily going to hurt the local industry. The real impact, we believe, is not going to be felt locally—although people may get a bit confused if we lose the name. The growers' biggest concern is about potential future exports to the UK.
This matter is relevant to where we're at in this debate, because it gives us the chance, again, to talk about the importance of having a government that advocates for all producers, for all exporters, when it comes to free trade agreements. The UK, like Australia, has a great racing culture and racing industry. Just as prosecco has been the flavour of the season for a couple of spring racing carnivals, it's believed that it will take off in a similar way in the United Kingdom, and we hope for, and wish our growers, the best of luck when it comes to that.
Of course, it's not just the Italian varieties that are now grown and bottled in Australia that are doing well. We have the opportunity to export many of our wine grapes and the winemaking story that goes with them. In my electorate of Bendigo, in central Victoria, we have more wineries than schools—more winemakers than schools. In each little nook and corner of Heathcote you are likely to bump into a shiraz grower and winemaker, and all of them have their own stories.
To the south, we have the Macedon Ranges. Many who have been to the Virgin Club may recall the fantastic Hurley flat pinot, another great wine and one that deserves recognition for what they have been able to achieve in the Macedon Ranges. As you work through the Macedon Ranges towards Castlemaine and Mount Alexander there's another great winemaking region in Harcourt. Throughout Malden there are winemakers, and then you move onto Bendigo and Heathcote. It's a great shiraz country, but it's increasingly diversifying and moving with climate change and focusing on different varieties.
This is another reason that we need to continue to invest in building our export industries. Our winemakers are innovative and are adapting. They are changing varieties that they are planting to adapt to changing weather conditions. Just a few weeks ago, I was at a Sutton Grange winery and they talked us through the history of the varieties on their vineyard and how they were changing because the climate was changing. The impact of climate change on our wine regions in Australia will be disastrous if our winemakers don't adapt, and they are. I was talking to winemakers in the Yarra Valley, who are now purchasing land in Tasmania because they believe that Tasmania may be the only place left in Australia that will be cold enough to grow pinot noir grapes. I know that there are many people in this place who might be alarmed to hear that, being pinot noir fans. But that's the reality if we don't get on top of and tackle climate change in a real and meaningful way.
The stats stand out for themselves about the growing importance of wine industry exports to the Australian economy. In 2015-16,1.6 million tonnes of grapes were produced into wine in Australia. We have over 3,230 wine farms in Australia. Many of those are small family-run operations—small boutique wineries—but there are some larger wineries and winemaking regions. Treasury, as people know, is one of the big ones, and there's Penfolds in South Australia. In fact, South Australia is the largest producer of wine grapes, making up 51 per cent of the total production in 2015-16. These are industries that also employ thousands of workers, particularly in the big states like South Australia.
It's important to note that 41 per cent of Australian wine is currently exported to the United States and China. But there is a hope among the winemakers that, because of the different varieties that we have and the different quirky stories of our winemakers, the UK exports could increase. So the amendment before us may seem minor today, but it has the potential to give us real opportunity as our winemakers start to sell into the United Kingdom.
One thing we do need to note is the way in which our winemakers are increasingly value adding to their produce. They are not just making wine these days; many of them are also producing their own preserves and their own olive oil. One in my area has even started his own sparkling wine. Our winemakers are working with our apple growers to produce sparkling apple wine, sparkling cider and sparkling apple juice.
The real innovation that occurs in the wine industry does occur at the farm. But, if we are true and want to see a growth in wine exports, one of the things we must also focus on is ensuring we have the skills required in the industry. Far too often when you are in wine regions you hear that people wanting a career in wine struggle to be able to enrol in a course that is close by. There are fewer and fewer TAFEs offering winemaking as a course today and fewer and fewer opportunities for people to be able to study this particular pathway, which is disappointing, knowing that people are converting to drinking wine and wine has become a big part of our culture. It doesn't matter who you talk to in the industry, whether it be the restaurant owner, the AHA or the pub on the corner, a lot of people within the hospitality industry now recognise the important role that wine plays. We must continue to invest in the skills and in the industry if we are going to have the ability to produce exports into countries like the UK.
As one of the previous speakers mentioned, this is one of the first minor amendments in relation to the Brexit that we expect will happen in the UK. We don't quite know where that's going, particularly after reading in the media in the last 24 hours about the future of Brexit. There's probably going to be lots and lots of these bills coming forward when we deal with the UK exiting the EU. We need to make sure that we are continuing to put Australia's best foot forward. We need to make sure that we're getting the best deal, particularly when it comes to wine. It's a value-added crop. It's a crop that we know is supported by a number of small businesses. It's a real opportunity for us going forward.
I do want to acknowledge that some of the money has started to flow in relation to the $50 million Export and Regional Wine Support Package. A few winemakers in regional Victoria have spoken about how they have been able to tap into that. However, in some of our areas, they are disappointed that they missed out. It's a bit hard to define the Pyrenees and Central Victoria all as one wine region. It's just not possible. There is some work to do within the industry to make sure that we are properly defining our wine areas. There are areas within areas. Whilst we talk about the top 10, it's important not to forget the smaller ones.
Two-thirds of our wine is exported to the value of $2.4 billion a year, and that will continue to grow. The industry contributes $40 billion to our economy and employs 170,000 people, from the people working on the vineyards, to the people working at the cellar doors, to the wine sellers, and so on and so forth. It is an important industry for us, and one we need to continue to support.
In my concluding remarks, I do wish to encourage the government, with this amendment, to continue to engage in aggressive way to support our wine varieties and wine that is going into the UK. We have a real opportunity to establish a market for our smaller producers. They have missed out on the boom in China, because their wine the just not cheap enough for China. That is a real missed opportunity number of our small winemakers. When the China-Australia Free Trade Agreement was done, we were concerned that the small winemakers would miss out—and they have.
There are reverse trade missions, where Chinese merchants come out and speak to the winemakers. But, of course, they just kind of say, 'We want it for 4c a litre. We want all of the wine that you produce in a year.' For the winemakers in Victoria, that's just not what they produce. They are boutique winemakers; they have a story behind their wine. When you go to the cellar door you meet the winemaker and you meet the owner of the business—they are the same person—and they have a great story behind what they produce. If you are in an area like Heathcote, in every winery that you go to, the wine is different. Even though it's grown in the same soil, it's different because of the way in which the winemaker has made that particular variety.
I would urge the government, with these discussion that are going on, to think about the smaller producers, to think about how we can better tell their story and to think about how we can market many small winemakers into the UK market, as opposed to what we tried to do in China, which was about being big and having bulk. It was great for the big guys in the industry, but not great for the little guys in the industry.