A STAGGERING 85 per cent of the country's 2015 winegrape harvest of 1.67 million tonnes was produced at a loss, with just 6pc of national production profitable.
The startling estimates are contained in the Winemakers' Federation of Australia's 2015 Vintage Report, which was released at the Wine Grape Council SA's Wine Grape Growers Summit at Adelaide Oval.
The level of unprofitable production across the country has risen 1pc since the 2014 harvest, while low-profit – profit between $100/t and $300/t – and breakeven production – profit of up to $100/t – remained steady at 4pc and 5pc, respectively.
The story is particularly concerning in warm inland regions – such as SA's Riverland – where 92pc of production was deemed unprofitable. Just 1pc of production was profitable.
"The experiences of warm inland regions continues to be very challenging, and we must never forget that behind each of these statistics lies a small business and a family," WFA chief executive Paul Evans said.
In cooler climate areas, profitable production – defined as profit of more than $300/t – was more common, with 33pc of production bringing strong returns.
The 2015 Australian grape crush is marginally up on last year's result of 1.66mt, and sits below the eight-year average of 1.7mt.
"What this report shows is that we're in a relatively similar position to what we were 12 months ago," he said.
"There are some modest positive signs in the macroeconomic environment – exchange rates, free trade agreements, strengthening consumer demand in our key markets – but overall profitability remains an enormous challenge for this industry and all parts of the supply chain.
"Let's not sugar-coat it – the world has fallen out of favour with Australian wine. We need to address that, and address that urgently. As a consequence, profitability will rise, not only for winemakers, but for grapegrowers as well."
SA accounted for 47pc – or 716,592t – of the national harvest, with shiraz, chardonnay and cabernet sauvignon again the most common varieties grown.
Barossa Valley shiraz is the shining light of the state's winegrape production, with average prices from the 2015 harvest setting new records after spring frosts prevented bumper yields.
According to WGCSA, the weighted average price for Barossa shiraz this year hit $2137, compared to $1849 in 2014 and $1719 in 2013.
