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Australia’s short harvest could impact U.S. market

Australia’s 2007 wine grape harvest of 1.4 million tons fell fall short of the nearly 2 million tons last year, a shortfall that could have ramifications in the U.S., particularly in the bulk market.

Jim Moularadellis, owner of the Australia’s largest bulk wine broker, Austwine, says, “Whites, which make up 52 percent of the crush, were down 14 percent in 2007, and reds, which are 48 percent of crush, were down 35 percent.”

The implications will most likely be felt in the lower value wines, but much of that goes to Europe, according to Moularadellis.

“That won’t have much of an impact on the U.S. market However, we expect to see more of a reduction in bulk wine exports, which have grown rapidly in the past four years, to approximately 200 million liters.”

It’s not all bad for Australia’s wine industry, when viewed as a whole, according to Stephen Strachan, chief executive, Winemakers’ Federation of Australia.

“Following record production over the last three years, the wine sector has welcomed this year’s shortfall and believes it will go some way to restoring sustainability back into our inventory balances.”

Australia’s wine grape growers will likely continue to struggle to some degree for the next few years.

For the 2007 crop, the problems were threefold, says Moularadellis.

“We had repeated freezes in the springtime in areas such as the Limestone Coast and Coonawarra region. Second, we had a very severe, dry winter and spring, which was drought-induced. And third, there were water restrictions in the inland districts of Riverland, Murray-Darling River, and Griffith that limited irrigation of those grapes.”

How quickly growers can recover from that remains to be seen.

“Right now, we’ve had good opening rains in some areas,” Moularadellis says. “But dam levels in the Murray-Darling Basin system are only about 10 percent of capacity. I’m guessing we have about a 1-in-10 chance of getting back to normal in only a year. It will probably take several years to catch up.”

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