Vintage 2020: quantity constrained but value continues to grow

Market Bulletin | Issue 209
07 Jul 2020
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The 2020 Australian winegrape crush is estimated to be 1.52 million tonnes – the equivalent of approximately 1 billion litres of wine. While the crush was the smallest in more than 10 years, it was not as low as had been widely speculated.

The 2020 crush was 12 per cent lower than the 2019 crush, and 13 per cent below the long-term average of 1.75 million tonnes.

Although it was the smallest crop since 2007, in terms of yield it was most like 2010, when the crush was 1.61 million tonnes, but the vineyard area was about 4 per cent higher than the current area (see Figure 1).

Figure 1                                Australian winegrape crush and average yield 2005–20

A smaller crop was widely anticipated, given the drought conditions affecting much of Australia, compounded by bushfires and associated smoke damage in some regions as well as isolated frost, hail and flood events. These difficult conditions inevitably took their toll on crop potential. However, autumn temperatures were generally around average or slightly cooler, leading to ideal ripening and harvesting conditions and the reduced yields resulted in more concentrated colours and flavours in the berries, which are expected to produce above-average quality wines.

Yields in the three large inland regions: South Australian Riverland, Murray Darling–Swan Hill and Riverina, which make up around three-quarters of the crush, were less affected than other regions due primarily to the availability of supplementary water. Together these regions were down by 4 per cent compared to 2019, while the remaining regions were down collectively by 34 per cent, with a wide range of individual variation.

Bushfire effects

Bushfires directly damaged vineyards in a small number of regions in 2020, while a larger number were affected by smoke damage.

There were reports of losses, rejection or positive smoke taint tests from 18 different regions, with the most affected (in terms of percentage crop reduction) being Hunter, Orange, Tumbarumba, Canberra District, Southern Highlands and Hilltops (NSW), Adelaide Hills and Kangaroo Island (South Australia) and Alpine Valleys, Beechworth and Glenrowan (Victoria). Most regions of Victoria and South Australia were unaffected, as were all the regions of Western Australia.

A supplementary survey was conducted by Wine Australia in conjunction with the National Vintage Survey 2020 to assess the effects of the bushfires on the crush. Results from the smoke survey indicated that approximately 40,000 tonnes of winegrapes were lost, rejected or substantially downgraded as a result of smoke or fire. While this represents a considerable loss on an individual basis, overall it equates to just 3 per cent of the national crush, meaning that the bushfires did not have as significant an impact as seasonal variations, weather events and drought.

Crush by state and region

South Australia accounted for an estimated 720,000 tonnes (47 per cent of the national crush). NSW was the second largest contributor with an estimated 491,000 tonnes[1] (32 per cent), followed by Victoria with 263,000 tonnes (17 per cent)[2].

Figure 2                                Share of crush by state 2020

The largest individual region by crush size in 2020 was the South Australian Riverland, accounting for 34 per cent of the national vintage, followed by Murray Darling–Swan Hill in VIC/NSW (25 per cent) and Riverina NSW (20 per cent). All three increased their share of the crush compared to 2019. The fourth largest region in 2020 was McLaren Vale – reporting a larger crush than Barossa Valley and Langhorne Creek for the first time since 2004. Margaret River jumped two places from tenth largest region in 2019 to eighth in 2020 (Table 1).

Table 1                  Share of crush and planted area by region for top 10 regions

 

Collected tonnes

% crush

Area

% area

Riverland

461,385

34%

21,816

15%

Murray Darling–Swan Hill

350,443

25%

15,577

11%

Riverina

268,547

20%

17,248

12%

McLaren Vale

28,751

2%

7,173

5%

Barossa Valley

28,326

2%

11,156

8%

Coonawarra

26,240

2%

5,293

4%

Langhorne Creek

24,286

2%

6,094

4%

Margaret River

21,312

2%

5,671

4%

Padthaway

16,428

1%

4,067

3%

Wrattonbully

12,372

1%

2,666

2%

All other regions

137,756

10%

49,583

34%

Total

1,375,846

 

146,244

 

 

Crush by colour and variety

The overall reduction of 200,000 tonnes compared with 2019 was split almost 50:50 between red and white varieties. The crush of red grapes[3] in 2020 is estimated to be 836,462 tonnes – a reduction of 105,000 tonnes or 11 per cent compared with 2019. The white crush was 684,146 tonnes – down by just under 100,000 tonnes, which was slightly more in percentage terms (13 per cent). This led to the white crush reducing its share of the total to 45 per cent – down from 46 per cent in 2019 and 48 per cent in 2018.

The main contributor to the reduction in white crush was Chardonnay, which was down by 70,000 tonnes (19 per cent) compared with 2019. Chardonnay remained the second largest variety overall with 285,000 tonnes, but lost ground to Shiraz, which declined by 10 per cent (45,000 tonnes) to 376,000 tonnes. Despite the decline, Shiraz fared relatively well compared with other varieties and increased its share by one percentage point to 45 per cent of all red varieties and 25 per cent of the total crush.

Of the top 10 red varieties, Merlot was down by the most (20 per cent) while Durif and Ruby Cabernet increased by 9 per cent and 8 per cent respectively. Durif overtook Grenache to be the seventh largest red variety.

All of the top 10 white varieties decreased in 2020 compared with the previous year, except for Pinot Gris/Grigio, which was almost identical at just over 70,000 tonnes and Prosecco, which increased by 2 per cent to just over 11,000 tonnes and moved up to ninth place, overtaking Gewürztraminer.

Riesling suffered the biggest decrease – down 28 per cent to just under 17,000 tonnes, dropping below Muscat à Petits Grains Blancs to eighth place in the top 10. This is the first time since at least 2001 that the crush of Riesling has fallen below 20,000 tonnes. At its peak in 2005, it was over 40,000 tonnes.

Other varieties

The top 10 red and top 10 white varieties together accounted for 95 per cent of the total crush in 2020 (see Figure 3). The remaining 68,942 tonnes are made up of a further 63 red and 51 white varieties. Around half of these were reported by fewer than three wineries across Australia.

Figure 3                                Share of winegrape crush by colour and variety

Analysis of grape purchases

There were 926,160 tonnes of purchased grapes reported in 2020 – accounting for 67 per cent of the total collected tonnes.

The average value across all purchases in 2020 was $694 per tonne, an increase of 5 per cent on the 2019 average value of $663 per tonne.

The average value of reds increased by 3 per cent ($28 per tonne) to $871 per tonne, while the average value of whites increased by 5 per cent ($25 per tonne) to $486 per tonne (Table 2).

Table 2                  Tonnes purchased and average value year-on-year comparison

  2019   2020    
Colour Purchased tonnes Average value ($/tonne) Purchased tonnes Average value ($/tonne) % change in average value
Red 557,863 $843 500,009 $871 3%
White 497,185 $461 426,151 $486 5%
Total 1,055,049 $663 926,160 $694 5%​

 

The increasing differential between average prices for red and white varieties may be contributing to a change in the varietal mix. While seasonal factors have a strong effect, there appears to be a slight downward trend in the share of white varieties, since it peaked at 50 per cent in 2015 (Figure 4).

Figure 4                                White share of total crush 20015–20 (source: ABS and Wine Australia)

Estimated value of the Australian winegrape crush

In 2020, the estimated value of the total winegrape crush was down 9 per cent to $1.07 billion compared with $1.17 billion in 2019. The 9 per cent reduction reflects the reduction in tonnage partly offset by the increase in average value.

The full results of the National Vintage Survey can be found here.


[1] Murray Darling–Swan Hill is split between NSW (45 per cent) and Victoria (55 per cent).

[2] These estimates are higher than the tonnes collected from each state, as they are raised to allow for the national estimated non-response rate of 9.5 per cent. Therefore, they do not match the figures in the state and regional summary tables, where only the collected tonnes are reported.

[3] Pinot Noir is counted in the red crush although some of it is used to make white (sparkling) wine.


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