Oh crap, We Made Too Much Wine: McGuigan Simeon

Submitted by Craig Strzelecki on 6 February, 2006 - 09:55

McGuigan Simeon, Australia's second largest wine producer has warned that this years grape harvest may be another record crop. It may be good news for the primary growers but some wine makers are still hurting from last year's record crop. McGuigan Simeon's managing director say that "There's a possibility of that, although [the hot weather] hasn't been sustained in the last week - the weather has been temperate," Brian McGuigan said. "Nevertheless, there's a huge crop this year. There's no doubt it's ripening earlier than it has been previously."

Basic Rule Of Supply and Demand: Too much Supply and Constant Demand Equals Fall in Price

Another factor regarding the weather is the lack of hail or fost as well as the adequate water supplies brought by the rains in recent months so the grape crop may be set for another record harvest. The Australian Bureau of Statistics recently reported Australia recently crushed a record 1.93 million tonnes of grapes in the 12 months to June 30, 2005. A record 1.42 billion litres of wine was produced and only 77 per cent of that was exported or sold locally. The Australian Wine and Brandy Corporation (AWBC) estimates wine makers are sitting on 900 million litres of excess wine stock, about 80 per cent of the wine exported and sold locally last financial year. AWBC predict this years harvest will be down 5 per cent from 2005. Evans & Tate, a troubled wine grower has come very close to folding but there may be still hope this year for a lower grape harvest.