Wineries For Sale as ABARES Predicts Bumper 2021-22 Production

Wineries For Sale: Farmbuy.com Buyers' Guide

The value of wine grape production is expected to fall by 28 per cent to around $870 million in 2021–22, driven by lower prices and lower production, according to the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) just-released Agricultural Commodities Report.

This comes as the average price of wine grapes is expected to fall significantly because of sharp declines in the prices paid for red varietal grapes, ABARES’ Charley Xia notes. Vintage 2022 is also forecast to be smaller than last year’s record volumes but is expected to remain above 10-year averages.

Xia adds the value of wine grape production is forecast to continue falling by 7 per cent to $810 million in 2022-23. Exports and domestic sales are expected to pick up, he says, but their rebounds will still be relatively small compared to further additions to already elevated inventories.

“The outlook is even more pessimistic in a scenario where global demand and supply chains remain disrupted in 2022-23. If this were to occur, the value of production can be expected to fall even further as grape prices continue to decline,” Xia adds.

Between 2023-24 to 2026-27, ABARES suggests there will be sizable differences between production values depending on whether international supply chains remain unsettled, forecasting the value of production to range between $740 million to $820 million in real terms in 2026-27.

Wineries For Sale: Grape Production

In 2021-22, ABARES forecasts wine grape production to be above average due to favourable seasonal conditions over spring and early summer in most growing regions.

Production of red varietal grapes is expected to fall by 20 per cent from the record level reached last year, but production of white varietal grapes is expected to fall more modestly by two per cent.

Beyond 2021-22, area planted to wine grapes is forecast to remain largely unchanged, however, varietal changes are expected as growers respond to changes in demand profiles, ABARES says.

Xia adds that production over the projection period will be reliant on vine yields, with water storage levels helping to buffer them against drier seasonal conditions.

“As water storages become more depleted later in the projection period, the timing of a dry year in 2024-25 assumed in the slower recovery scenario will cause bigger drops in production than if a dry year occurs in 2023-24 assumed in the faster recovery scenario,” he notes.

Wineries For Sale: Exports

Export constraints – including high shipping costs and disruptions such as container shortages and port congestion – are expected to see the value of exports fall significantly to $2.3 billion in 2021-22.

Xia adds that strategies aimed to diversify into established or new international markets continue to be hampered by marketing difficulties such as the inability to attend trade shows or perform face-to-face sales.

“These issues have compounded the difficulty of needing to re-direct a significant volume of red wine previously destined for China,” he notes.

In 2022-23, ABARES expects the value of exports to increase 11 per cent to $2.5 billion as supply chain disruptions ease. However, export prices are forecast to fall as costs of holding inventory rise and global demand remains weak.

Over the medium term to 2026-27, the value of wine exports is expected to peak between 2024-25 and 2025-26, ABARES believes, as the global environment stabilises and prices improve.

Wineries For Sale: Prices

The average price of wine grapes in Australia is expected to fall in the short term between 2021-22 to 2022-23 as demand for newer vintage grapes is depressed as carryover inventories of wine remain high due to weak and disrupted sales.

“The loss of China as a major export market for Australia has significantly affected demand for red varietal grapes, but is less of a factor for white varietal grapes. This is because China has not been a significant market for Australian white wine, with Chinese consumer preferences heavily skewed towards Australian red wine,” Xia points out.

ABARES expects prices of red varietal grapes to decline by the greatest amount in 2021-22, just as the ratio of inventory-to-sales of red wine is forecast to reach record highs.

In 2022-23, red grape prices are forecast to rise modestly but there remains a risk that prices could fall further if elevated levels of inventory persist in the event of the slower recovery scenario.

Better price prospects for red varietal grapes are expected during the latter half of the projection period, according to ABARES, reflecting improving economic conditions and supply chain operability, and greater marketing opportunities to help grow demand for Australian red wine.

By the end of the projection period, prices of red grapes are expected to average around $700 per tonne in nominal terms. These prices would be similar to levels seen prior to the booming period between 2015 and 2020, which was created by the addition of demand from China, Xia says.

Prices of white varietal grapes are expected to rise modestly in 2021-22 as global inventories of white wine remain low. Sales of white wine are also expected to be slow, due largely to COVID-19 impacts on logistics and transportation costs; and lower demand from the restaurant and hospitality sectors in Australia and globally.

Over the medium term to 2026-27, a return to average production in major wine exporters is expected to help build global white wine inventories, placing downward pressure on prices of white varietals in Australia. However, those prices are expected to gradually rise during later years, just as global demand and supply chains return to normalcy.

Wineries For Sale: Opportunities And Challenges

Key challenges faced by the industry include the availability and costs of fertiliser and labour, ABARES notes.

Labour availability, in particular, has become an issue for medium to large wine businesses, with many reporting difficulties finding staff such as viticulturists and winemakers. The lack of availability of these skilled labourers is expected to constrain capacities of businesses to move inventories and fulfill sales. On the other hand, smaller wine businesses have been less affected by staffing issues.

Rising costs and international shortages of diammonium phosphate (a key ingredient used during the fermentation of grapes) are also likely to impact on wine production in 2022. The flow-on effect of this will be felt more greatly by small-to-medium wine producers.

While newly negotiated supply contracts between growers and winemakers will reflect less demand for grapes in the short term, the Australia-United Kingdom Free Trade Agreement is expected to bring opportunities. In 2021, Australian wine exports to the UK totalled $453 million, making it Australia’s new top export destination for wine, both in terms of value and volume.

To capitalise on the investment opportunities in Australia’s world-class wine industry check out farmbuy.com’s favourite wineries and table grape enterprises currently for sale below. Click on the following link to check out more wineries for sale Australia!

Wineries For Sale: Lot 2 Cowanna Avenue, Merbein West ,VIC

This winery for sale is an established table grape enterprise boasting a variety of quality table grapes on a 30-acre land holding.

Boasting good soil, the property comprises 25 acres of sought-after table grape varietals, including Crimson Seedless, Midnight Beauty, Flame Seedless and Menindee Seedless.

Irrigation comprises drips throughout, in addition to some overheads and low-level irrigation. In addition, 70 megalitres of water is also available to purchase.

Click on the following link for more information on this winery for sale Australia.

Wineries For Sale: 118 Seventh Street Extn, Birdwoodton, VIC

This professionally developed and operated table grape property has been developed to a very high standard and has a reputation for producing top-quality table grapes.

The winery for sale is located in the well-regarded Birdwoodton area in relatively close proximity to Mildura city and Mildura airport.

The enterprise comprises seven parcels, with approximately 49 hectares planted to table grapes including IFG patented varieties and 3.2ha of dried grapes.

It includes a well-appointed 2,000sqm packing shed complex, machinery and chemical sheds, substantial plant and equipment, and a number of staff quarters.

Irrigation is via three separate pump sites with fertigation systems in each, and delivered by low-level sprays, drip irrigation and cooling sprays.

Click on the following link for more information on this winery for sale Australia.

Wineries For Sale: 5 Bate Lane & Lots 398 And 399 Coorong Avenue, Red Cliffs, VIC

This is a great opportunity to acquire a large vineyard holding in the Sunnycliffs area of the Sunraysia region in north-western Victoria.

This 20.09-hectare (49.64-acre) winery for sale boasts high yields, excellent soil types and a 209ML annual water licence, making it ideal for redevelopment to table grapes.

Comprising three titles (two adjoining and one adjacent), Lot 420 covers 7.26ha and has all infrastructure in place, including 11-inch trellis spacing, ready for replanting.

Lot 399 has 6.6ha planted to Chardonnay – plus a three-bedroom home; while Lot 398 has another 6.23ha planted to Chardonnay.

Irrigation is delivered by drip irrigation, via electric pump with filtration system.

Click on the following link for more information on this winery for sale Australia.

Wineries For Sale: 139 Paringi Road, Paringi Via Monak, NSW

Seldom does the opportunity to acquire a top-class table grape property of this type arise right in the heart of where the industry was born in Australia.

Boasting more than 53 metres of absolute Murray River frontage, ‘Paringi’, with its deep elevated rich red loamy soils, is very well regarded. The elevated location and gradual slope down to the Murray River assist this property with frost control and enjoys the benefits of early fruit maturity.

The property is planted to well-regarded table grape varieties, including a large percentage of Sunworld varieties - Adora, Midnight Beauty, Sonera and Autumn Crisp – as well as other desirable plantings, namely Flame Seedless and Crimson Seedless.

‘Paringi’ is maintained to an exceptional standard, with both under-vine sprays and dripper irrigation, large cool room/packing shed complex and large machinery shed.

Click on the following link for more information on this winery for sale Australia.

Wineries For Sale: 607 Boomerang Avenue & 670 Ropers Road, Cardross, VIC

This winery for sale is a large 32.9-hectare mixed grape enterprise, comprising 4ha of Autumn Royal, 5.4ha of Crimson Seedless, 3.2ha of Thomson Seedless, and 0.4ha of Menindee Seedless, with a mixture of ‘V’ and angle trellis, plus 6.1ha of Merlot on two wire vertical trellis.

The balance of approximately 12ha is mainly cleared of plantings with some posts and dead vines in place with areas ready for redevelopment.

Irrigation infrastructure consists of four bank Arkal filter system coupled to a PTO driveshaft. The winery has drip irrigation throughout, including non-producing areas of the vineyard with a total AUL of 261.9ML.

There’s also a modest four-bedroom home and small shed set well off the road in need of considerable maintenance, plus an additional 12m x 9m shed in good order with power connected.

While there’s work to be done, this winery for sale presents as an opportunity to secure a large parcel of irrigatable land with the opportunity to redevelop non-producing areas to high-demand table grapes.

Click on the following link for more information on this winery for sale Australia.