Australia's hottest summer in more than 100 years saw the $6.2 billion wine industry sweating over low crop yields.
A combination of long-lasting drought conditions and heatwaves has resulted in the production of grapes falling by almost 50 per cent in some regions this year.
Chief Executive of Australian Grape and Wine Inc. Tony Battaglene labeled the 2018-19 harvest a "nightmare vintage".
"Both the drought and the heat have played a vital role in the low grape production.
"This year's vintage will be about 10 to 15 per cent down from last year, which was about 1.70 million tonnes," Mr Battaglene said.
Australia's wine vintage usually begins in late November and carries on until late March – the exact timing of Australia's hottest summer since 1910.
As soon as the heat hits, the grapes begin to ripen very quickly prompting growers to their harvest much earlier than usual.
"The heat causes a concentration of the grapes and they lose volume producing a more intense grape.
"Sometime it enhances the quality but it can also bring on logistical problems as there are only a small amount of manufacturing areas, particularly at night when grape farmers harvest.
Grape growers and wine makers are working round the clock.
"At the moment we have a very compressed vintage so everything is coming on very quickly. It's an early vintage in the eastern states and it's a late vintage in the west. It will be all finished by Easter and that never happens," Mr Battaglene said.
Water availability due to the drought is another contributing factor to the low crop yields.
According to Mr Battaglene, if the drought continues the next vintage will be much worse than what farmers experienced in 2019.
"Next season, it's not just the shortage of water, it's the availability of water. So water pricing is currently up to $500 a mega litre. Soon we won't be able to produce grapes at an economic basis.
"f we continue in drought, the next vintage could be very problematic in terms of trying to produce grapes of quality and at the right price.
The wine industry's water issues also come down to their aging farmer population as the next generation aren't taking over the family farms as often as they used to.
"People will sell off their water when they sell their land, therefore that water is no longer available to the wine industry.
"I think there is a systemic use of water that most of agriculture is facing. The wine industry is getting older and there aren't young farmers coming in so we are actually losing access to that water," Mr Battaglene said.
On a positive note, grape prices are up 8 per cent because international demand is through the roof.
Australia exports 70 per cent of its wine, with China now becoming Australia's biggest market valued at $1 billion. The US and UK are trailing china at $500 million each.
"At the moment we are in shortage of supply, lower than we have had before, because of the demand in the export market."
