Cyclone-ravaged orchardists facing balance sheet woes
Many companies are financially mortally wounded by the effects of Cyclone Gabrielle and may have to sell up because of their high debt levels.
Cyclone Gabrielle added to an already tough year, with individual businesses hit hard. In some cases vineyards were wiped out and a lifetime's work was eliminated in one devastating 24-hour period.
The response to the impact of the cyclone is now well underway, but the road to recovery will be long and difficult. Government funding will be critical to the infrastructure rebuild (and the timing of that), while the level of support offered to affected businesses will be an important factor in private sector reinvestment decisions.
The impact of the cyclone on vineyards and wineries elicited a strong response from the wider New Zealand wine community. Offers of support came from growers and wineries across Aotearoa, all wanting to help out their colleagues in affected regions. Donations to regional charitable trusts will help support the activities of regional associations in coming months.
The impact of the cyclone also highlighted the strength and importance of regional wine associations in the affected regions, which have played a critical role in coordinating responses at a local level. They have worked tirelessly to provide much needed support to those who are faced with a monumental task of assessing damage, undertaking the clean-up, and considering their future. This support will be needed throughout the next few years and beyond.
For its part, New Zealand Winegrowers (NZW) has focussed on the issues where we can make a difference. We provided additional funding for Hawke's Bay Winegrowers and initiated our emergency response system. We responded to numerous queries from members, and have provided advice across a range of issues to growers and wineries. With funding from the Ministry for Primary Industries (MPI), we partnered with Hawke's Bay Winegrowers to engage viticulture specialists to provide on-the-ground advice to affected vineyard operators. Currently we are seeking to quantify the cost of the storm to provide information to MPI that will help inform government support for the recovery phase.
The storm and its aftermath have been a timely reminder of the ties that bind our New Zealand wine community together. Just as with the Covid-19 pandemic, we saw a strong and united response from across the sector, with individual businesses and industry bodies working together in pursuit of common goals. Once again in tough times, it has been made clear that we will generate the best outcomes for individual businesses by working together in a united way.
Of course, 'together' does not mean 'the same'. In an industry body with more than 1,400 members there is always going to be a diverse range of business models and interests. And you can guarantee that in a hugely dynamic sector like the New Zealand wine industry, there will be lots of diversity - from regional and varietal to markets and business models, and the list goes on. That diversity is without doubt one of the driving forces behind the success of the sector - it provides our customers with more reasons to buy more New Zealand wine, on more occasions.
While that diversity is hugely important, underlying it was some fundamental shared interests and values; together these shape the activities of NZW. For example, all our members either grow grapes and/or make wine in New Zealand. That means they have a shared interest in understanding the rules governing grape growing and wine production in New Zealand, and influencing the shape of those rules. They have a shared interest in how to take best advantage of our unique growing environment, how to protect that environment, and in telling the stories about the unique attributes that comes from growing grapes and making wine in this very special place. They have an interest in getting the best access to markets, whether in New Zealand or overseas, and shaping the rules around that market access to their advantage. These shared interests are reflected in the focus we have on research, environment, advocacy, and marketing, supported by strong comms and investment into regional organisations.
Cyclone Gabrielle tested growers and wineries in the North Island in ways not seen in a generation.
The response to the cyclone's impact demonstrated once again, the strength and resilience of the New Zealand wine community. It has reminded us all - growers, wineries, regional and national industry bodies - that together we are stronger.
