Riverland grape growers at the mercy of imperialist finance capital

Nick G.

South Australian Riverland grape growers are angry at the prices offered for the coming harvest’s grapes by Berri Estates Winery (above).  The wine company is owned by US-based Constellation Wines, the largest wine producer in the world.

Growers are being offered as little as $180 per ton of grapes although their co-op has a contract with Constellation to base prices on an industry average which is around $230 per ton.  They regard the $50 differential as unacceptable and are prepared to go to court over the matter.

All of this is a far cry from the boom times for wine producers when payments to growers sat around $1000 per ton. 

It reflects both the anarchy of the capitalist market and the growing separation of producers from the big companies controlling wine production.

Berri Estates Winery is the largest combined distillery and winery in Australia.  Much of its bulk wine is shipped overseas, but a sizeable component is also used to add volume to wine produced in other parts of Australia.  Often this goes unnoticed as a bottle of wine can have up to 15% of its wine included from outside its declared region before having to have it identified on the label.

The Riverland was once the home of the Australian citrus and fruit industry, but the orange and pear trees, the apricot trees and others have long gone following the removal of tariff protections and the subsequent competition from overseas corporate growers.

“Blockies” – families working on and owning their small irrigated blocks on the 300 km stretch encompassing Blanchetown, Morgan, Waikerie, Barmera, Berri and Renmark – ripped out their fruit trees and pulled down their packing sheds and put in vines, hoping to secure a future on the land.

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Now many find themselves at the mercy of an overseas giant run by private equity firms out for a quick return on investment and with little regard for small communities distant from international boardrooms.

The blockies are both hard-working physical labourers and small-scale capitalists.  Their dual identity is both a strength and a weakness.  Around 600 blockies belong to the local co-op, CCW, and use that to try and present a united front to Constellation.

At one time they had considerable control over their livelihood.  There was a strong Australian market for Riverland produce and apricots, oranges and pears paid for many elite private school educations and overseas holidays.

With the change to vines, CCW was formed in 1981 from the merger of two Riverland co-operatives – Berri Co-op Winery & Distillery Ltd and Renmano Wines Co-op Ltd – with the main aim to produce wine from shareholders' fruit and offer a satisfactory return to CCW growers on fruit delivery.

In 1989 CCW was restructured, forming the publicly unlisted company Berri Renmano Limited which then merged (1991) with the Hardy Wine Company based at suburban Reynella south of Adelaide.  The new entity, BRL Hardy continued to expand but as it did, so grew the distance between growers and producers with the former becoming increasingly marginalised.

Whilst these factors create conditions for unity among the growers, their internal divisions prevent a more militant approach to the conglomerate that owns the winery.  They are divided into first, second and third class suppliers by Constellation based on grape quality and compete for status and recognition as growers.

Growers did unite and carried out a collective action last February (2014) with a tractor drive and protest outside Parliament House in Adelaide (see http://vanguard-cpaml.blogspot.com.au/2014/03/winery-workers-and-grape-growers-in.html).  It was an emotional and heartfelt rally.  But the growers are divided into those who want more action of this type and those who want a more conservative approach.

“We hear suggestions from some, who should know better, that we should ‘withhold supply’. It won’t happen,” said a writer on the Riverland Wine Grape Growers  Association website on January 9.

Others want a campaign to give growers an extra 20c per bottle return.  Currently they get around 25c per bottle.  The same writer dismisses the idea.  “It won’t happen”, he says.

A mass campaign and united mass action directed at Constellation could be much more effective than the proposed legal path, but the inherent conservatism of the blockies works against them.

The blockies may not see it is these terms, but capitalism has led them to declining fortunes and an uncertain future.  They are now at the mercy of giant imperialist corporations and have an objective interest in lining up with the working class to win genuine independence and a secure place as co-operatively organised growers in a planned socialist economy.