The ACCC has released this issues paper to assist interested parties in making submissions to the ACCC’s wine grapes market study. The paper contains:

• details about what will be covered in the market study
• issues on which we are seeking comment, and
• information about how to make submissions and key dates for the market study.

Global demand for wine created a boom in new vineyard plantings in the late 1990s. Exports grew rapidly to peak in 2007. From 1991 to 2007, the Australian wine sector more than tripled production from less than 400 million to 1.2 billion litres.

However, by 2005-2006, an international wine glut resulted in a significant over supply of wine grapes in Australia. This supply and demand imbalance persisted until at least 2016 and had a particularly marked impact on prices in warm climate growing regions, which account for around 70% of wine grape production.

Since 2017, supply and demand has become more balanced, mostly driven by increasing demand from China and growers exiting from the industry in Australia. A downturn in European, South African and Chilean production is also likely to have contributed to stronger demand for Australian wine grapes.

Despite these improving market conditions, the ACCC has continued to hear concerns from industry participants regarding the issues outlined in this paper.