In the past year, we delivered on the goals of our Strategic Plan 2015–20 with the average value of Australian wine exports reaching $3.89 per litre FOB, the highest level since 2004–05, and winegrape prices increasing by 5 per cent to $694 per tonne.

The total value of exports decreased marginally over the previous year, dropping 1 per cent to $2.84 billion. The first half of the year saw exports tracking the growth trajectory of previous years, but the second half stalled due, indirectly, to measures imposed world-wide to address COVID-19. Export volumes dropped by 9 per cent due to a reduction in available supply following three consecutive years of lower vintages.

Uncertainty remains around the extent, duration and impact of the COVID-19 pandemic in health and economic terms however, there are some clear trends emerging in relation to wine sales: consumers have continued to buy wine during the pandemic but there has been a strong shift to purchasing online.

The first two quarters of 2019–20 showed increases in exports compared with same periods in the preceding year, but in the third quarter ending March 2020 there was a decline of 7 per cent when compared with the same quarter in 2018–19. The fourth quarter was slightly stronger with exports declining by 4 per cent when compared with the corresponding period in the previous year.

Wine Australia’s activities in all areas of operation were impacted by the pandemic. Our staff around the globe followed local guidance and moved to working from home wherever possible. We also changed how we delivered on our priorities. Rather than face-to-face engagement at events we moved to social platforms and our regulatory team responded to restrictions on travel by switching to ‘virtual’ audits reviewing records and carrying out interviews online.

Marketing

We were fortunate that we were able to execute significant elements from the $50m Package including our largest-ever USA trade and consumer engagement program, the Far from Ordinary campaign, and back-to-back trade and media engagement in Shanghai with the China Awards, ProWine China and the Decanter Shanghai Fine Wine Encounter before the pandemic brought travel and public engagement to a halt.

As key events in Europe and Asia were postponed or cancelled, we redeployed our marketing resources into social media engagement, retail and distributor promotions and online engagement in Canada, China, the USA and the UK. Our previous investment of $50m Package funding in content creation, the Australian Wine Made Our Way branding and in the Australian Wine Discovered (AWD) education program meant that we were able to draw on the wealth of assets to enrich engagement opportunities and the response was overwhelmingly positive.

In the coming 12 months, we will continue engaging trade, media and customers and building demand for Australian wine with a firm emphasis on social media, digital and retail channels to increasing online engagement.

RD&E

Our research and development (R&D) investments continued to focus on delivering practical outcomes for grapegrowers and winemakers. We also provide the sector with timely insights and analysis on supply and demand, domestic and international competitors and markets and consumer trends to allow them to make informed business decisions.

Through the Australian Government’s Rural R&D for Profit program, 17 new technologies have been developed for the wine sector that are at various stages of sector readiness. These include:

• a package of ‘precision agriculture tools’
• a prototype hand-held NIR instrument and calibration set that can predict bud fruitfulness in the vineyard
• a data processing pipeline combined with machine learning to process video captured from Go-Pro cameras to accurately count inflorescences down a vineyard row and thereby provide a yield prediction shortly after budburst
• technology to provide on-the-go, non-contact measurement of canopy size and structure, whole vineyard nutrition status, and detection of disease, and
• a kit for sprayers that uses LiDAR and radar to automatically assess canopies and adjust application in response and an ‘electronic leaf’ to measure spray coverage were developed.

We released the ground-breaking Climate Atlas, the result of a four-year research project led by the University of Tasmania, that models potential climate change impacts for each of Australia’s wine regions in ten year increments out to 2100. The Climate Atlas provides grapegrowers and winemakers with a decision-making platform and we commenced a series of webinars to help rollout and explain the concepts underlying the Climate Atlas at a regional level.

Wine Australia is a key player in the Council of Rural Research and Development Corporations group looking to share climate-based research. We are also working collaboratively with other plant-based Research and Development Corporations (RDCs) on biosecurity projects, in particular Xylella fastidiosa, a plant pathogen that impacts a broad range of plant species from blueberries and citrus to grapevines and olives and an enormous range of ornamental plants.

We started implementing the findings of an independent review of our extension and adoption investments. Our Extension and Adoption Strategy will see us implement best-practice knowledge transfer to accelerate the adoption of new knowledge.

Congratulations to Joseph Marks from the University of Adelaide, who was the inaugural recipient of the Dr Tony Jordan OAM Award, which recognises the most outstanding applicant among a field of exciting and high-calibre PhD scholarship candidates and honours the late Dr Jordan’s myriad contributions to the Australian grape and wine sector.

Regulation

During the year, there were 3101 active exporters and the team issued 18,629 product approvals and approved over 50,000 shipments.

After extensive consultation in development, rigorous testing and a series of workshops, webinars and the creation of on-line tutorials, the Wine Australia Licensing and Approval System (WALAS) went live in June. WALAS provides enhanced access and self-service functionality and has been warmly received by exporters.

The regulatory team adapted its operations to manage the COVID-19 restrictions, replacing onsite audits with web-based interviews and the online reviews of records of nearly 4000 products to verify the accuracy of labelling claims prior to issuing export approvals.

In the coming year, the team will be developing the Wine Label Intellectual Property Directory (Label Directory), which will require exporters to upload label images as a precursor to obtaining shipping approval for labelled products. The Directory will be publicly accessible and searchable by image matching and by text fields.

Looking forward

Our focus for the next 12 months will be on delivering value to the grape and wine sector through our new Strategic Plan 2020–25. With the 2020 vintage being the lowest in more than a decade, we have planned for lower levy income and have reduced our operational expenditure and will draw on reserves to maximise the investment in R&D, marketing and regulation. The declining value of our levies in real terms year on year will continue to place pressure on our ability to invest across the sector’s priorities.

We will strive to deliver value to stakeholders and deploy resources within a strict governance and risk framework to ensure the most efficient and effective use of funds.

Thanks

I would like to thank the global Wine Australia team who have retained their focus on delivering outstanding service for levy payers in a very fluid environment. We have all had to adapt to new ways of working and I congratulate the team on embracing change. As the $50m Package funding draws to a close we have farewelled colleagues who have contributed significantly to the wine sector and to Wine Australia’s activities and I thank them for their efforts.

I would like to join with the Chair in recognising Brian Walsh, who guided Wine Australia from 2014. Brian’s wisdom, vision and generosity helped shape not only Wine Australia but the broader sector.