Speech to NZ Winegrowers function

It’s great to be here tonight to launch this report on the economic contribution wine makes to New Zealand.

I believe it’s really important to celebrate your success as growers, producers and exporters. 

The wider primary industries are the backbone of New Zealand’s economy, making up around 73% of all our exports. Viticulture is an important part of that and this report shows us just how far you’ve come.

From a modest beginning, the wine industry is now our 7^th largest export earner with an estimated $1.33 billion in exports at June 2014.

Around 86% of our exports are our outstanding Marlborough Sauvignon Blanc.

The conditions here are perfect, with the right soils, sunshine and a strong international reputation for quality.

Like all farmers and growers, you have shown resilience and determination in the face all kinds of challenges over the years – extreme weather events, natural disasters and a tough exchange rate.

I’m really pleased the wine industry has set a goal of reaching $2 billion worth of exports by 2020. It’s ambitious but achievable.

As a Government we want to back you, because we have a similar goal – to double the value of primary sector exports by 2025.

Trade

That’s why we have a big focus on improving trade access for your products.

Five years of free trade with China; two-way trade has now reached $20b. An increasingly important market for NZ wine.

Chinese Taipei (Taiwan) – tariffs on wine were eliminated overnight on 1 December last year.

We are currently negotiating the Trans-Pacific Partnership which includes 11 countries, including the important markets of Japan and US.

We also have FTA negotiations underway with South Korea and India.

Last week a report was released into future demand for food and beverage products in Asian markets. It’s interesting to note a recent report by Coriolis identified sparkling wine and brandy as potential growth areas.

Primary Growth Partnership (PGP) programmes

Research and innovation will be very important.

In November 2013, MPI agreed to invest in the Lifestyle Wines Primary Growth Partnership (PGP) programme. This is being led by the industry through New Zealand Winegrowers.

This is a $17 million, 7 year project that will be developing low-alcohol, low calories wines. This will be a new, promising niche market for our wine producers.

This is the largest ever R&D project in New Zealand’s wine industry.

The programme aims to deliver economic benefits of $285 million per annum by the end of 2023.

Sustainable Farming Fund (SFF) Projects

The Government has also funded a range of projects over the last 12 years through the Sustainable Farming Fund.

These have included disease prevention, managing vine yield, energy efficient winemaking, residue-free wine production, and a sustainability accreditation programme.

RSE

I know that a reliable supply of workers is also essential for your industry.

Recently the Government announced we’re raising the number of RSE workers from 8000 to 9000 per year. We’ll also be developing a new programme aimed at getting more Kiwis into seasonal work.

In the longer term, we need to attract more people into our primary industries. A recent report shows that we’ll need 50,000 more workers by 2025 and around half of these will need to be tertiary level or level 4, or higher.

Government and industry will need to work together where we can on attracting, training and retaining the right people.

Sustainable Wines 20^th anniversary

Congratulations also tonight to the New Zealand wine industry in celebrating the 20^th anniversary of the Sustainable Winegrowing Programme.

There is widespread adoption of this label, with 94% of total vineyard area certified under the programme.

The primary sector is the backbone of NZ’s economy. Your hard work pays for our roads, schools and hospitals. I don’t believe you get thanked enough for that.

Congratulations again and all the best for a great evening.