Sunday, January 26, 2020

TheGrue Menu

Riverina Winegrape Growers Centre

182 Yambil Street (PO Box 385)
Phone: +61 2 6962 3944
Fax: +61 2 6962 6103
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

History of the Wine Grapes Marketing Board

The Wine Grapes Marketing Board was constituted in 1933 to represent the interests of winegrape growers within what is now the City of Griffith and the Shires of Leeton, Carrathool and Murrumbidgee. At that time governments were promoting policies of decentralisation and job creation in rural NSW following the return of soldiers from World War I. Legislation establishing the Murrumbidgee, Coleambally and Murray Irrigation Areas was subsequently passed, as was closer settlement legislation to facilitate regional development.

These various policy settings created isolated, regionally-based, farming communities. In the absence of sophisticated communication, transport, and marketing systems, as exist today, statutory marketing arrangements were introduced to provide farmers with a means of countervailing the market power of the purchasers of their products.

The Board is one of several statutory marketing authorities established under the NSW Marketing of Primary Products Act 1927. The MPP Act was introduced at a time when trade practices legislation was minimal. The first true Commonwealth trade practices legislation was the Trade Practices Act 1965. Numerous changes were made to this and subsequent pieces of legislation until the current Trade Practices Act 1974 was introduced. Prior to this Act, restrictive trade practices were lawful until successfully challenged by the Trade Practices Commission. From 1974 onward, such practices became unlawful.

Until 1976, the Board negotiated informally with MIA winemakers on prices, with agreements made on a hand shake basis. This mode of operation broke down during the mid-1970's when demand changes resulted in a price slump for red wine grapes, the predominant grape varieties at the time. In 1976, vesting power (ownership of the crop) was granted to the Board for those varieties. In 1978, this power was extended to all wine grapes produced in the Board's area of jurisdiction.

The Board rarely used its vesting power to compulsorily acquire the crop. The Board has, however, used vesting as a reserve power to set minimum grape prices and conditions of payment, to pursue late payments by winemakers, and to require payments to growers to be made through the Board. The latter condition simplifies the collection of the grower levies which the Board uses to fund grower services.

In 1997 legislative changes constrained the Board's vesting power in that the Board was prohibited from physically receiving wine grapes. An expiry date for constrained vesting of 31 July 2000 was also set.

In preparation for the expiry of constrained vesting, the Board introduced an indicator price system, rather than minimum prices, for the 2000 harvest. This was in part due to the following Board observations: 'minimum prices tended to create a low benchmark, which wineries then treated as the price. Prices above the Board minimum were regarded as bonuses"

In 2003 the NSW Government created the Wine Grapes Marketing Board (Reconstitution) Act 2003 that provided the Board with transitional powers to set and enforce terms and conditions of payment for winegrapes in the region not subject to a complying contract. After 3 renewals of this instrument it was repealed by the Government 1st January 2012.

The Board now operates solely as an Agricultural Industry Services Committee under the Agricultural Industry Services Act 1998.