Wine growers feeling the pain

The wine industry says the big rise in the number of vineyards up for sale in Marlborough is a sign of the times and wine isn't quite the liquid gold it used to be.

A combination of overproduction, falling prices and the global recession are being blamed for growers putting wineries and vineyards up for sale with the number on the market soaring from 30 last Christmas to about 150 now.

New Zealand Wine Growers chief Philip Gregan says the industry is in a definite slump and vineyard prices have dropped from about $250 a planted hectare to $150.

Gregan says it's a consequence of the market position combined with a huge influx of new people into the industry. He says there is interest from new markets like Asia, but only time will tell if the industry can bounce back. He says they need small companies that perform well because they provide a lot of the excitement in the industry.

But he says it's also vital to have big companies because they carry a lot of the commercial clout needed for market place success.

Agents say falling prices for growers have led to the explosion in the number of wineries and vineyards going up for sale.

John Hoare from Bayleys real estate in Marlborough says they are not moving because price expectations are out of touch with the market. He says he usually has about a dozen properties on his books, but at the moment there are more than 50.

Hoare says growers revenues are down by between one third to 50% on what they could make a couple of years ago and while there is still interest in the properties, buyers seem to be waiting for the industry to pick up.

He expects some of the small operators will disappear, or be swallowed up by the bigger ones.