Economic Impacts of Viticulture and Winemaking on Employment ...

<strong>Economic</strong> <strong>Impacts</strong> <strong>of</strong> <strong>Viticulture</strong> <strong>and</strong><strong>Winemaking</strong> in the Central RangesZone <strong>of</strong> New South WalesJim McFarlane1

The Central Ranges Zone <strong>of</strong> NSWThe Central Ranges Zone is a wine growing region inNew South Wales on the inl<strong>and</strong> side <strong>of</strong> the GreatDividing Range. It includes the formal wine regions<strong>of</strong> Cowra, Mudgee <strong>and</strong> Orange. 2

Grape Yields (t/ha)Farm Price($/t)Grape Yields & Prices in the Central Ranges15105Yields 11.5 12.47.4 8.102001 2006 2012 2012Yield(t/ha) Breakeven Yield$2,000$1,468 $1,331$583 $626$1,500$1,000Prices$500$02001 2006 2012 2012Average Price/t Breakeven Price 3

MillionsHectares <strong>of</strong> Vines40%The Importance <strong>of</strong> Compiled DataAverage Vineyard Margins30%20%10%0%-10%$70$60$50$40$30$20$10$034% 33%-7%2001 2006 2012Vineyard Revenue$60 $61$21$82001 2006 2012 2012ABS EstimateTotal Revenue98008800780068005800480038005576Hectares <strong>of</strong> Vines7038400052232001 2006 2012 2012ABS Estimate Hectares <strong>of</strong> Vines 4

HectaresABS Core Employment NumbersEmployment20151050Employment17.89.1 10.12001 2006 2012Hectares Per Worker8006004002000Total Employment56394561653091602001 2006 2012ABS (Full Time) Part Time 5

MillionsMargins for Wineries$400$300$212 $297 $280Margin$200$100$0$262$156$2022001 2006 2012Wineries revenue Wineries Expenses26%28%12%2001 2006 20126

Millions$600$500$400$300$200$100$060%40%20%0%-20%$317<strong>Economic</strong> <strong>Impacts</strong>$167$67$490$432$212 $205$121 $972001 2006 201235%21%45%Flow-on %Changes-14%-3%2001-2006 2006-2012-25%-40%Gross Output Value-Added H-Hold Income7

Millions$20$15$10The Industry's Flow-onSectorFlows$5$060%56%2001 2006 201247%31%50%Flow-on %Changes10%-40%2001-2006 2006-2012Other Business-17%Retail Trade-26% -25%Wholesale Trade-38%8Accommodation, Cafes <strong>and</strong> Restaurants

MillionsThe <strong>Impacts</strong> <strong>of</strong> the Aggregated Sectors$100$80$60$40$20$0Aggregated Flows70%50%30%10%2001-2006 2006-2012 2001-2012 -10%ManufacturingTrade <strong>and</strong> Accommodation -30%Business Services50% 48%42%Flow-on %Changes2001-2006 2006-2012-24% -19%-28%9

<strong>Impacts</strong> <strong>of</strong> the Multipliers2001 2006 2012TOTALIMPACTSTOTALIMPACTSTOTALIMPACTSMULTIPLIERSGROSS OUTPUT<strong>Viticulture</strong> 1.442 1.543 1.895Wineries (net) 1.379 1.559 1.478TOTAL 1.395 1.556 1.508VALUE-ADDED<strong>Viticulture</strong> 0.851 0.807 0.682Wineries (net) 0.694 0.640 0.719TOTAL 0.735 0.672 0.716H-HOLD INCOME<strong>Viticulture</strong> 0.397 0.485 0.800Wineries (net) 0.259 0.359 0.302TOTAL 0.563 1.018 0.759EMPLOYMENT (no)<strong>Viticulture</strong> 13.7 14.8 16.1Wineries (net) 5.1 7.1 5.3TOTAL 7.3 8.6 6.110

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<strong>Impacts</strong> <strong>of</strong> the Flow-on most BenefitedSectorsYears 2001 % 2006 % 2012 %/changeSector-Flow-on $'000 Change $'000 Change $'000 2001-12Other Business Services 6,942 56 15,914 -17 13,603 49Retail trade 7,670 47 14,525 -26 11,541 34Communication Services 4,764 57 11,153 -16 9,654 51Road Transport 4,351 59 10,585 -14 9,288 53Wholesale Trade 6,432 31 9,312 -38 6,757 5

Grapes Prices

Winery Revenuesyear cases total revenue total expenses pr<strong>of</strong>itin millions in millions in millions in millions2001 3.4 $212.2 $156.1 $56.12006 4.7 $297.1 $262.3 $34.62012 3.8 $279.8 $202.0 $77.7

The Aggregated Flow-on Comparison

The Flow-on Decline in the Vineyards

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