Australia’s wine industry blasts budget funding cuts

Australia’s wine industry is pressing the federal government for support after the 2026 budget left out new funding for growers and winemakers facing falling demand, higher costs and pressure in regional communities.

Australian Grape & Wine, the national peak body for the sector, said it was deeply disappointed by the budget and argued that its proposals for targeted assistance were ignored. The group said it had asked for measures to help the industry manage a difficult transition, lower long-term costs and reduce damage to regional economies, but received no new funding.

“This budget is a bitterly disappointing outcome for an industry under significant and sustained strain,” Lee McLean, the chief executive of Australian Grape & Wine, said in a statement. “We did not ask for a handout. We put forward practical, targeted measures to support an orderly transition, reduce long-term costs, and minimise the impact on regional communities. Once again, the government has chosen not to act.”

The criticism comes as growers in South Australia’s Riverland and other wine regions contend with a supply-demand imbalance that industry leaders say has been worsened by the loss of export markets, rising input costs and broader global uncertainty. The sector has also been dealing with weaker grape prices and pressure on cellar door sales as consumers spend more cautiously.

Tim Whetstone, the member of Parliament for Chaffey, whose electorate includes much of the Riverland wine country, said the budget was “a kick in the guts” for an industry he described as being “on its knees.” Whetstone, who worked in winemaking, trading and exporting for about 20 years, said many growers could no longer make grapes profitably while also covering the cost of producing wine.

“We’ve now come to the point where people are no longer able to grow grapes, and it’s now becoming cost-prohibitive to make wine and a profit all at the same time,” he said.

Whetstone said the budget’s savings measures amounted to $191.6 million over five years and argued that Canberra had stepped back from its responsibility to help the sector adjust. He has been calling for what he described as structural adjustment support from state authorities, including education programs and low- or no-interest loans for growers and wineries trying to adapt.

Australian Grape & Wine said one of its main concerns was the planned phaseout of the Wine Tourism and Cellar Door Grant program, which gives eligible wine and cider producers grants of up to $100,000. The group said that program had helped regional businesses attract visitors and sustain direct sales at a time when many were already under strain.

The 2026 federal budget said it would save $104.6 million over five years by reducing funding for grant schemes including that program. McLean said withdrawing support now would hit regional businesses at exactly the wrong moment.

“At the worst possible time, this government has chosen to withdraw a program that directly supports regional businesses,” he said.

The industry body warned that without intervention, some growers could abandon vineyards they can no longer afford to maintain. It said that could create environmental problems as well as economic damage in towns that depend on wine production, tourism and related services.

McLean said expecting companies and growers to absorb the adjustment on their own was unrealistic. He said the result would not be an orderly transition but a disorderly retreat from vineyards and communities that have long depended on them.

Treasurer Jim Chalmers’ office was contacted for comment.