NZ winegrowers upbeat about upcoming harvest

New Zealand winegrowers remain upbeat about this year's harvest, despite earthquakes and adverse weather.

In recent weeks parts of New Zealand have been hit by heavier than usual rainfall, colder temperatures for January and high winds, accompanied by flash flooding, land slips and road closures. However, "in our major wine growing regions, the weather hasn't been too bad at all," said New Zealand Winegrowers chief executive Philip Gregan. "At this stage, things are looking pretty good."

The bulk of New Zealand's wine is produced in Marlborough on the northern tip of the South Island and Hawke's Bay, on the North Island. Wine exports totalled $1.6 billion last year and 70 percent of the industry is located in Marlborough.

Looking ahead to the harvest that will run from late February to late April, Mr Gregan said "we are not expecting an overly big harvest. At this stage, I think we are looking at an average harvest." Marlborough has been sheltered from the worst of the weather and in Hawke's Bay the weather has been warm and good, he said.

Hawke's Bay Winegrowers Association vice chairman Xan Harding said: "So far the growing season has been as close to perfect as we could wish for." Mr Harding said growers are positioning for a vintage "of the highest quality" with the potential to surpass even the stellar vintages of 2008, 2014 and 2015. He noted the area is well enough advanced into the growing season that a lot of the quality already "in the bank" but said the difference between a good and great vintage will come down to the weather in March and April.

The Marlborough region was also hit by the November earthquake, which damaged about 20% of wine storage tanks leading to a wine loss of some 2% of the area's total annual production. Mr Gregan said, however, there would be little impact on this year's harvest as "the process of tank repair and/or replacement is progressing according to plan."

Regarding other risks to the sector, Mr Gregan said that news the US officially pulled out of the Trans-Pacific Partnership was disappointing. Newly installed president Donald Trump withdrew the US from the controversial trade and investment pact as a first order of business this week.

New Zealand spent some six years pursuing the 12-nation Pacific Rim pact in the hope of securing a historic first trade deal with the US. Gregan said eliminating tariffs on wine imports into the US would have been "nice to have." Wine imports into the US make up just under $500 million of the total.

However, the long-term benefit of the TPP was access into some of the Asian markets, such as Japan, he said. "It's obviously a disappointment that we are not going to have improved access to those markets but we will just have to see how things develop," he said.

(BusinessDesk)