WFA, WET, TWE, Powrie – Tax, Halliday – Semillon

The board of the Winemakers’ Federation of Australia (WFA) met in Adelaide on March 23. The meeting would have been interesting to observe. A couple of TKR readers have asked if I know the real situation regarding the departure of CEO Paul Evans. The inference being: did he walk or was he pushed? The other question I have been asked is did he resign because he doesn’t like the direction the industry or the WFA is heading?

I do not know. They really are questions for Evans to answer. I suspect there is no more to it than he has a new job and better opportunities for his own future.

I have also been told Treasury Wine Estates (TWE) is changing its policy relating to tax and no longer supports volumetric tax.

The reader who discussed this with me said moves to significantly restrict or abolish the wine equalisation tax (WET) rebate would lead to all the small producers moving en masse to a volumetric supportive position.

The first of a series of papers by Ian Powrie is to be found on the new page inserted this week, titled Other articles. It also includes a recent article I wrote for Wine & Viticulture magazine on the Virginian wine industry.

Unfortunately it’s not a paying gig, but if any reader wants to have an article published on any aspect of the industry/trade, please submit to me at tony@thekeyreport.com.au

Powrie’s report and the follow-up reports in coming weeks are worth studying, absorbing and, hopefully, acting on.

They are different from other reports, in some ways more complex. But persistence over the coming weeks will be rewarded.

I rather enjoyed this sentence from Powrie: This leaves the wine industry and others who are hungry to a fate similar to that of Oliver Twist, awaiting his nemesis at the hands of Mr Bumble, the workhouse master.”

For those readers who don’t know Powrie, here’s a short bio:

“My interest in matters strategic originated with military history. It was part of the curriculum at the Royal Military Academy Sandhurst to study a large military campaign, during the second year of the course. In my year the study was Sherman’s ‘March to the Sea’, formally the Savannah Campaign with its battles and skirmishes and associated scorched earth alternative action. This history left me with an interest in the importance of process and content, organisation and review when dealing with complex issues.”

From the army Powrie studied in the US, than joined an American multinational in its international division. He spent the next 15 years living and working in seven different countries. Eventually, becoming CEO of a strategic business unit with a global reach, in matters of production and marketing, structure, performance and reporting. Powrie says: “Inevitably this experience ended with me practising an American philosophy towards international business with a preference for a ‘small government profile’ in business matters.”  

During this time Powrie took an interest in wine, eventually returning to academic research in combination with a business advisory practice. He continued to gain experience, but more of that later. He ends:

“Specifically in connection with government inquiries, policies, laws and regulations, as interventions in the commercial development of the Australian wine industry within the context of a global market, I think that two specific aspects of current practice are insufficiently examined: the breadth, depth and dependency of industry performance on governmental decision making; the concomitant weakness prevailing in the industry’s own strategic thinking across a raft of matters at a strategic level including, process, content, industry organisation, funding, performance and reviews. In combination the industry suffers from strategic decisions not entirely of its own choosing or making.”

As already stated, go read.

If there is any disgruntlement with ProWein, none has come our way. The fair says it had 55,000 trade visitors, up 6 per cent on 2015. The final media release from the fair included this: “The largest exhibitor nations this year included Italy (1500), France (1300), Germany (1000), Spain (550), Austria (320), Portugal (300) and Overseas (600). Added to this were some 420 exhibitors from 30 countries with their special spirits. Exhibitors from a total of 59 nations attended the event.”

ProWein is in its 10th year and seems to go from strength to strength. This year there were 500-plus Australian wines from 21 regions on the Wine Australia stand. Bookings are being taken for the 2017 fair, and it’s probably worth getting in quick. I really must get there one day.

The TKR website is taking shape. Please look at the directory page, or your ad elsewhere if you have one, and check that the logo is up to standard and the information there is correct. We want it to be right and up to your standards. Any changes needed, please email tracey@hummingbirdmedia.com.au and they will be dealt with.

Some partners prefer to remain confidential and not have their name either in an ad or in the directory. That is fine. We thank you all for the support.

The readership levelled out this week in terms of straight openings from the email. Analytics from The Key Report website showed direct access was up. Overall readership is increasing. Please encourage friends interested in wine or staff working in the industry/trade to sign up for the weekly email.

Below is the opening paragraph of an article by Benjamin I. Cook, Climate Scientist, Columbia University; Published in The Conversation 22 March

“Wine grapes are one of the most valuable horticultural crops in the world, a globally important industry with commercial vineyards on six continents and all 50 U.S. states. Like many crops, these vineyards, and their grapes, are extremely sensitive to temperature and rainfall during the growing season.”

It’s not a bad article but most of what is said is already known. It appears to be aimed at the consumer not those involved in wine. I was intrigued with the comment about all 50 American states having vineyards as I’m not sure about Alaska. As far as I am aware there are wineries but most produce fruit wines such as raspberry and blueberry or fruit/wine blends but I think the grape juice is brought in from other parts of the US. If anyone knows if there is a vineyard or vineyards in Alaska please let me know.

An article that is worth reading can be found on the James Halliday Australian Wine Companion website.

It’s by Halliday and starts, “Is there an Australian wine that’s more unique – or undervalued – than Hunter Valley semillon? ” Go read it’s worth it.

Easter is coming up, enjoy time with friends or family but be safe especially with drink/drive,

Tony

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