Innovation Boosts Australia’s Wine Industry

Australia is economically one of the most sound countries to consider investing in right now. With an immaculate track record of positive economic growth, a pro-business government and healthy commercial environment, the country presents ideal conditions for entrepreneurial success.

At the heart of this successful economy are prosperous agriculture and food and beverage industries. Famous Australian wines sit at the intersection of these two sectors, whose guardians are looking for new ways to innovate their production processes. We explore Australia’s lively wine industry, and where tech businesses are welcomed into the fold.

Australian Wine Industry – Agricultural exports from Down Under

Australia houses a fierce agricultural sector, which continues to grow thanks to technological improvement and structural changes. Two-thirds of the country’s agricultural outputs are exported to key trading partners, an increasing number of whom are Asia-based.

This chart, taken from Australia’s Department of Foreign Affairs and Trade website, shows the export value of agricultural goods totaling AU$44.7 billion in 2016, and the indicative value of alcoholic beverages to agricultural revenue:

Australia’s top 10 agricultural exports by value (A$ million, 2016)

Major agriculture export products — A$million in 2015 — Share of total (%)

Beef — 7,401 — 16.6

Wheat — 4,853 — 10.9

Meat (excluding beef) — 3,575 — 8.0

Wool — 3,021 — 6.8

Alcoholic beverages — 2,587 — 5.8

Sugars, molasses and honey — 2,332 — 5.2

Vegetables — 2,260 — 5.1

Dairy — 2,216 — 5.0

Live animals (excluding seafood) — 1,875 — 4.2

Fruit and nuts — 1,762 — 3.9

This table was taken from https://dfat.gov.au/trade/organisations/wto/Pages/agricultural-trade.aspx.

Contributing to 26 years of consecutive national economic growth, Australia’s food and beverage outputs generated around AU$172 billion in revenue in 2017. This is largely split into retail (with a turnover of AU$115 billion), and foodservice (AU$57 billion).

Value of a good Australian drop

Australia has a strong wine industry, ranking as the fifth-largest exporter of wine in the world. Wine businesses generate over AU$40 billion to the economy each year.

Vineyards take up around 135,133 hectares of land in the state-continent, the most popular grape variety being the famous Shiraz, accounting for 30% or 39,893 hectares of that land. Chardonnay, a popular white wine variety, maintains 21,442 hectares, or 16% of the total.

In 2018, Australian wineries crushed 1.79 million tonnes of wine, 49% of which was concentrated mainly in the South Australian regions, such as Barossa Valley. This effort contributed to 1.29 billion litres of wine.

Challenges for wine businesses

The value of wine to Australia’s economy has driven a strong need to protect and future-proof it. Hotter summers and extreme weather events are creating complicated issues for the agriculture sector generally, and vineyards are no exception to climate changes.

International Beverages Competitions Founder Adam Levy explains some of the options wine businesses are considering to protect their valuable vines.

“Some are experimenting with new grapes that may be able to handle the climate disruption… others are looking for better ways to control the moisture of the soil to reduce sudden and extreme differences.” Land at higher altitudes is also being considered by vine-growers, to find ways to escape the heat.

Additionally, risk of disease and presenting a clear origin history of vines are also crucial issues wine businesses face. More than ever, consumers buy into the stories and origins of the grapes and want to ensure that the label they’re paying for is up to snuff.

Welcoming innovative solutions

To ensure vineyards and winemakers can continue to maximize their harvests in spite of weather changes and disease threat, they’re employing more processing equipment to get the job done faster and at optimum vine ripeness. Demand is soaring for machinery and mechanics that can improve efficiency and offset seasonal variations for grapes.

Another area that agricultural technology or ‘agritech’ is taking care of for winemakers is supporting their branding backstories.

Artificial intelligence and satellite imagery are being employed to produce high-tech mapping of the hundreds of thousands of kilometres of grapevines in Australia. This technology, put to use by Wine Australia, can identify planting locations and density without consulting vineyards individually using a computer algorithm.

The ‘National Vineyard Scan’ will not only develop a greater understanding of Australia’s booming wine industry, but also help its users manage biosecurity, disease, and ‘smoke-taint’ risks. It’ll also reassure connoisseurs of the origin of their drop with a higher degree of accuracy, using geographical indicators on labels that point to this technology.

Agritech opportunities

Wine Australia analyst Sandy Hathaway hopes that eventually, this important algorithm can track in more detail the varieties of the vineyards located through the National Vineyard Scan.

Beyond mapping, precision agriculture, drones, phase tracking and weather forecasting technology are key opportunities for supporting a highly-valued sector in Australia.

Businesses working in innovative spaces that can offer solutions to boost productivity during harvest season, track the health and seasonal variation of crops, forecast weather and control light and heat are set for enduring commercial success in this valuable industry.

Consider how your innovative venture could apply to Australia’s wine market; how satellite imagery or temperature control mechanisms could be reemployed to protect a national jewel and some of Australia’s finest wine brands.

Contact us to get started

Australia’s booming agriculture and food and beverage sectors will continue to be major money-makers for the country into the foreseeable future. And the technology that businesses are applying to one agricultural or peripheral venture can certainly come in handy in this Pacific Island’s dynamic wine industry.

If you’re ready to bring your product to Australia’s high-performing industries, speak to Biz Latin Hub to get started.

Our team, with our recently opened office in Sydney, provides expert guidance and carefully planned strategies for successful market entry into Australia.

Our customizable suite of back-office services are designed to ensure a smooth transition into your desired market. Reach out to us today here at Biz Latin Hub for more information about how we can support you.