Growers from a cooperative in Australia’s largest wine producing region have rejected an offer to sell their red wine contracts amid a crisis of global oversupply.

Hundreds of members from CCW Co-operative turned out to a meeting on Tuesday evening at Barmera in South Australia’s Riverland to decide their future.

More than 540 growers are members of the co-operative, which produces about 10 per cent of Australia’s wine. 

The propsed agreement was voted down by 314 members with only 17 in favour.(ABC Rural: Eliza Berlage)

The offer from multinational company Accolade Wines proposed buying out growers’ red wine contracts at $4,000 per hectare.

It would also reduce the contract, or preferred supply agreement, from 15 years to 10 years, and cut the volume of grapes it accepts by 20 per cent.

With prices as low as $150 a tonne for grapes from inland wine regions, the company hoped the offer would be taken up by growers wanting to exit the industry.

The proposal required more than two thirds of members’ support, but it was voted down by 314 members with only 17 in favour.

Loveday grower Jim Giahgias said it was a resounding and unsurprising result. 

“You’d be crazy to think any other way,” he said.

Growers say the resounding vote against Accolade Wines’ offer has united them.(ABC Rural: Eliza Berlage)

“I am relieved [the vote] is over, and I’m waiting to see the response from Accolade.

“I hope it’s a positive one. I hope it’s not about being angry about it, but I think they would have realised this would be the result anyway.

“Accolade Wines actually holds the region because it’s our biggest buyer of grapes and the biggest winery in South Australia, so hopefully if we can move on and work together it benefits both of us.”

Earlier this year the wine industry body for the region, Riverland Wine, stated it wanted to remove more than 13 per cent of local vines and pay growers an exit package of about $4,000 per hectare.

In April, Accolade Wines chief supply chain officer Joe Russo said that was how the company arrived at the buy-out price of $4,000 per hectare, or about $1,618 per acre.

Paramjit Singh Bagri says $4,000 per hectare is not enough.(ABC Rural: Eliza Berlage)

Monash grower Paramjit Singh Bagri said the offer was too low to support growers to remove their vines, let alone transition to farming other crops.

“What they’re offering us is not fair, it’s a mean offering. They are starting to play with us,” he said.

“$4,000 is nothing these days. It wouldn’t even cover the post removal.

“We need $50,000 per hectare. If they gave us that much money we could leave tomorrow.”

Many growers have been dumping their grapes on the ground this season.(ABC Rural: Eliza Berlage)

CCW Co-operative general manager Peter Szabo said the current preferred supply agreement has offered strength and support to both the growers and to Berri Estates Winery, which is owned and operated by Accolade Wines.

“The industry’s been unstable and people are insecure, and I think the vote offered a little bit of security back into the region,” he said.

“Unfortunately the government budget has offered no money as support to the growers and that makes it really difficult to transition into change [diversifying crops] because there’s no free capital.”

Mr Szabo said the near-century-old co-operative would need to rebuild its relationship with Accolade Wines.

Peter Szabo says growers need more financial support.(ABC Rural: Eliza Berlage)

In a statement, the Accolade Wines board of directors said it was disappointed by CCW growers’ decision to reject the offer.

It said the package was the only measure put forward by any party nationally to support industry transition to be more sustainable.

“It is not realistic to expect that the industry can keep operating as if global operating conditions and demand led influences have no impact on our respective domestic interests,” it said.

“If there is no change, grower and winery businesses will continue to suffer.”

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