Podcast: The Detail
Stormclouds over our vineyards
The Detail today talks to New Zealand Winegrowers CEO Philip Gregan about the storm clouds of trade disruption gathering over our vintners, as the industry marks 200 years since the country's first grapes were planted.
It’s 200 years almost exactly since missionary Samuel Marsden planted the first grape vines at the Stone Store in Kerikeri, on September 25, 1819.
The industry’s come a long way since then. Wine is now New Zealand’s sixth largest export worth 1.83 billion dollars. It’s shipped out to more than 100 countries, and supports 20,000 jobs here.
But there are rain clouds overhead. Our wine is being caught up in trade wars between the US and China, the US and the EU, and the Brexit breakup.
That’s why NZ Winegrowers was delighted when Prime Minister Jacinda Ardern described her meeting with US President Donald Trump as “an excellent discussion on trade” that she expected to be ongoing.
Winegrowers CEO Philip Gregan says the US is our biggest market for wine – in the year to June 2019 bringing in more than half a billion dollars. Only France and Italy are ahead of us.
“Even though it was only a short meeting I think that is significant,” he says. “We shouldn’t underestimate it.”
Gregan says the global trade system at the moment is under challenge, and exporters need it adhered to. Trump has labelled the World Trade Organisation as “greatly unfair to the US” and has threatened to pull out. That makes Gregan uneasy.
“As an industry we are dependent on a rules-based system of trade,” he says. “I think the United States and New Zealand working together to protect the WTO system is incredibly important.
“We have to believe that trade is positive. It brings countries together, it brings people together and the expansion of global trade in the last 20 and 30 years has been huge … I think everybody needs to do a better job in telling that positive story rather than seeing the negatives.
“Our industry would not be where it is today without freer international trade.”
Wine has been listed as a product for possible retaliation between the US and the EU – “potentially good news (for New Zealand) but you don’t like to see wine dragged into these things, and wine certainly into China from the US has been caught in the middle of the trade war. We’re a product like anybody else and when there’s all these tensions …
“As the expression goes, when elephants start to fight, smaller fry get caught – and potentially trampled on.”
But while the US situation is bad, the UK with Brexit is the number one concern.
“Our view has been always long term that there’s an opportunity for us with Brexit,” Gregan says.
Winegrowers believe our access into the UK market will improve relative to the access that may be enjoyed by the European producers – once things settle down. Until then there is potential for a lot of disruption at the border, “which is not good for anybody”.
The concern about what might happen there led to wine being shipped into the UK ahead of a potential March Brexit deadline so it didn’t get stuck at the border, and more is being sent now ahead of the new October deadline.
On The Detail today, Gregan talks to Sharon Brettkelly about that, and other challenges facing the industry.
Want more from The Detail? Find past episodes here.
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