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20th October 2024
Submission: Contractual Fairness Throughout the Supply Chain – From
Vineyard to Retail Shelf
Submission made by; Riverland Winegrape Growers’ Association (RWGA)
Written by; Ashley Ratcliff (chairperson)
Due to the recent resignation of the RWGA’s Executive Officer and the Independent chair, RWGA’s board members have unfortunately had a number of unexpected distractions over the past week, leading to a delay in our submission.
As the representative body of the largest wine growing region in Australia, we believe it was critical that we contributed our views on the current state of play in which wine companies conduct business with grape growers across the Riverland.
The board members of RWGA have reviewed submissions made by a number of wine industry bodies to evaluate it position on the fairness that grape growers and winemakers receive along the value chain, from vineyard to the retail shelf.
RWGA believes there are two key areas that require improving to strengthen fairness, which are;
1. Replace the existing voluntary code of code with a mandatory code of
conduct: The current code only applies to wine companies that agree to
undertake business activities with grape growers that are deemed to be fair and
reasonable. A voluntary code does not provide the appropriate penalties to deter
wine companies from abusing their position in a commercial relationship with
grape growers. Specific area of the wine company and grape grower relationship
that needs specific attention are;
a. Grape prices - must be fair and reasonable with consideration given to
market powers individual wine companies have on manipulating the
weighted average of specific regions.
b. Quality assessment – any alteration to grape prices based on quality
need to occur using subjective measures.
c. Grape payments – full payment of grapes purchased by the wine company
be made by the last day in June in each year of a contractual
arrangement.
2. Protect independent winemakers and distributors from large business unfair
business: The growing domination of large retail and wine distribution
businesses is creating an unfair barriers of entry for wine businesses that bring
unique wine offering to the market. These unique offering help build the
reputation of Australian Wine, encourages grape growers to value add the grapes
they grow (make wine) and elevates the overall potential value grapes growers,
winemakers and industry bodies (via levies) receive for the grapes grown and wine
made.
RWGA also supports the submissions of Wine Grape Council of South Australia and
South Australian Wine Industry Association (SAWIA), with the exception of SAWIA’s support of a voluntary code of conduct.
If you have any questions please do not hesitate to contact me on
Regards
Ashley Ratcliff
Chair – Riverland Winegrape Growers’ Association