The proposed 'Wine Restructuring Action Agenda' and alternative policy options for the Australian wine industry

Abstract

The Australian grape-growing and wine producing industry enjoyed meteoric growth from the early 1990s onwards, with wine sales forming an increasingly important element of both national export earnings and farm-sector income. Despite this success, a recent downward slump in industry profitability and a dampening of demand for wine has resulted in a call for government-assisted intervention, which would include a national 'vine-pull'. This paper examines the 'Wine Restructuring Action Agenda' (WRAA) proposed by a suite of industry bodies, and in particular the vine-pull policy option, in light of its predecessor, the vine-pull scheme of 1985-87. We argue that past experience suggests that both state and federal governments, and the industry itself, ought to explore the other options contained in the WRAA more fully, and indeed other emerging proposals for industry innovation and 'light touch' regulation, when addressing the long-term sustainability of the Australian wine industry.