Glut and slump force winery sales
Thirty-four boutique wineries and vineyards are on the block around New Zealand, as the effects of the economic downturn, a record vintage and an oversupply of wine on the market start to bite.
According to realestate.co.nz, 15 wineries, 12 vineyards and six land blocks for conversions to vineyards are for sale, ranging in price from $600,000 to $6.5 million.
Sources expect significant consolidation of the $1.4 billion wine industry next year in reaction to the glut in the market.
This year's vintage was up 30 percent to 285,000, the biggest on record.
This caused an oversupply situation in the market, when domestic sales were down 6% on last year, and export prices fell 2 percent. Average export receipts a litre fell to $9 this year because of the high value of the New Zealand dollar against key overseas currencies.
New Zealand Winegrowers' chief executive, Philip Gregan, said it was a very tough time for wineries.
``I think if you went out and asked if wineries are for sale, everyone would say yes, at the right price.''
A specialist pinot-noir winery in Cromwell was put up for sale this month, after owners Central Otago Vintners went into receivership.
The 1.9-hectare property has a $1.3m capital value and a land value of $300,000.
Central Otago Vintners owes $4.7m to Southland Finance Ltd, $1.3m to Secured Lending Ltd, and $1.2m to trade creditors.
The receiver's report noted that the industry would need to make ``informed and difficult decisions'' on how many grapes were needed to supply the market, which may mean a cut in yields and vineyards.
Meanwhile, Waiheke Island vineyard Ridgeview Estate, which went into receivership owing $5m in June, still hasn't been sold.
Gregan said there had been a continuing net growth in the number of wineries in New Zealand, which was not sustainable.
In August, the firm reported 585 wineries in the annual report, which had grown to 616.
Profit wasn't the only motive for people owning and operating small wineries, he said, but there was ``no use harvesting grapes and turning it into wine when you know you don't have a market''.
Competition was forecast to increase next year.
Sources say as much as one-third of this year's sauvignon-blanc crop might not be picked, in response to the financial crisis and an oversupply of grapes.
It is expected that some smaller wineries could go at fire-sale prices as their land value fell.