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Page 1: Text 2006 Annual Report - Parliament of NSW · Wine Grapes Marketing Board 2007 Budget 41 2007 Consolidated WGMB Budget 41 ... MYOB Mind Your Own Business – Financial Software
Page 2: Text 2006 Annual Report - Parliament of NSW · Wine Grapes Marketing Board 2007 Budget 41 2007 Consolidated WGMB Budget 41 ... MYOB Mind Your Own Business – Financial Software

WINE GRAPES MARKETING BOARD

For the City of Griffith and Local Government Areas of Leeton, Carrathool and Murrumbidgee

WINE GRAPES MARKETING BOARD Annual Report for 2006

Board Offices Location: Riverina Winegrape Growers Centre Residential: 182 Yambil Street GRIFFITH Postal: PO Box 385 GRIFFITH NSW 2680 Telephone: 02 6962 3944 Facsimile: 02 6962 6103 Email: [email protected] Website: www.wgmb.net.au Board Executive Members Chairman Bruno Brombal Mobile: 0429 630 465 Deputy Chairman Robert Bellato Mobile: 0408 477 210 Staff Members Chief Executive Officer Brian Simpson Mobile: 0438 388 828 Email: [email protected] Industry Development Officer Jason Cappello Mobile: 0409 288 554 Email: [email protected] Office Manager Gillian Conway Email: [email protected] Annual General Meeting Wednesday June 27 2007 Yoogali Catholic Club NSW Commencing at 8pm

Page(s) 1 Acronyms and Abbreviations used 2 Letter to the Minister 3 Chief Executive Officer’s Report for 2006

Statutory Compliance 3 Application for Extension of Time 3 Agricultural Industry Services of the Board

3-4 Aims & Objectives 4 Management and Structure 4 Board Members during 2006 4 Meetings of the Board 4 Board Members Attendance 4 Board Staff 4 Customer Access 4 Ethnic Affairs Priority Statement 4 Summary of Operations

4-5 Monthly Operations and Activities Brief for 2006 5 Funds Granted to Non-Govt Comm. Orgs 5 Legal Change 6 Economic or Other Factors 6 Management & Activities 6 Research & Development 6 Human Resources 6 Consultants 6 Equal Employment Opportunity 6 Disability Plans 6 Land Disposal 6 Promotion 6 Consumer Response 6 Guarantee of Service 7 Payment of Accounts 7 Time for Payment of Accounts 7 Risk Management & Insurance Activities 7 Disclosure of Controlled Entities 7 NSW Government Action Plan for Women 7 Occupational Health and Safety 7 Waste 7 Numbers of Executive Officers 7 Freedom of Information Act 7 Electronic Service Delivery 7 Appointed Auditors 7 Annual Reports 7 Legal Matters 7 Financial Year 7 Conclusion

2006 Year in Review 7-8 Chairman’s Report for 2006 9 Regional Association Reports

9-11 Research & Development Report 11-12 Minutes of the Previous Annual General Meeting 13-18 NSW Department of Primary Industries

18 Grape & Wine Research & Development Corp. 19 NSW Wine Industry Association 20 Riverina Production Statistics as at 26-03-07

Financial Reporting and Information 21-22 Statement by the NSW Audit Office

23 Statement by Members of the Board 24-40 Audited Financial Report

Wine Grapes Marketing Board 2007 Budget 41 2007 Consolidated WGMB Budget 41 Notes to the 2007 Consolidated Budget

43-45 Strategic Plan 2007 Budget Expenses

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RIVERINA - WINE GRAPES MARKETING BOARD 1 ANNUAL REPORT FOR 2006

ACRONYMS AND ABBREVIATIONS USED IN THIS REPORT

ABARE Australian Bureau of Agricultural Research Economics ABS Australia Bureau of Statistics ACCC Australian Competition & Consumer Commission AWBC Australian Wine & Brandy Corporation Avail. Available CEO Chief Executive Officer CRC Cooperative Research Centre CSU Charles Sturt University DAFF Department of Agriculture Fisheries and Forrestry DVD Digital Video Disk EEO Equal Employment Opportunity EMS Environmental Management System EPA Environment Protection Agency GIS Geographical Information Systems GST Goods and Services Tax GWRDC Grape & Wine Research & Development Corporation HACCP Hazards Analysis of Critical Control Points HWC Hot Water Extractable Soil Carbon IDO Industry Development Officer MIA Murrumbidgee Irrigation Area MLC Member of the Legislative Council MOG Matter Other than Grape MYOB Mind Your Own Business – Financial Software NSW New South Wales NSW DPI New South Wales Department of Primary Industries NSWWIA New South Wales Wine Industry Association NWGIC National Wine & Grape Industry Centre OM Office Manager PHA Plant Health Australia PO Post Office R&D Research and Development R,D&E Research, Development and Extension RDI Regional Development Initiative RITA Regional Innovation and Technology Adoption RIVIT Riverina Viticulturists, WGMB & winery reps RWIF Riverina Wine Industry Forum RTA Roads and Traffic Authority SDG Strategic Directions Group SA South Australia TO Technical Officer WGGA Wine Grape Growers’ Australia WGMB Wine Grapes Marketing Board WIRC Wine Industry Relationship Committee WFA Winemakers Federation of Australia WFP Wine Futures Project VFD Vineyard Field Day VIC Victoria YGGA Yenda Grape Growers’ Association

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RIVERINA - WINE GRAPES MARKETING BOARD 2 ANNUAL REPORT FOR 2006

Letter to the Minister

12 May 2007

The Honourable Ian Macdonald MLC Minister for Primary Industries NSW Parliament House SYDNEY NSW 2000

Dear Minister

The Wine Grapes Marketing Board, on behalf of all winegrape growers in the City of Griffith and the Local Government Areas of Leeton, Carrathool and Murrumbidgee, has pleasure in presenting the report for the year ended December 31, 2006. This 73rd Annual Report on performance, activities and financial results has been prepared in accordance with provisions of the Annual Reports (Statutory Bodies) Act 1984. The Wine Grapes Marketing Board applied to the Office of Financial Management in a letter dated 17th February 2007 to have this report presented later due to the Board’s concern that printing of the report would fall outside parliamentary guidelines for timing. The Board’s application was accepted in accordance with section 13(3) of the Annual Reports (Statutory Bodies) Act 1984 and an extension of time for the lodgement of the 2006 Annual Report of the Wine Grapes Marketing Board to 31 May 2007. Yours sincerely Bruno Brombal Chairman – Wine Grapes Marketing Board

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RIVERINA - WINE GRAPES MARKETING BOARD 3 ANNUAL REPORT FOR 2006

Chief Executives’ Report - Brian Simpson Welcome to all growers, industry participants and members of the public that are reading this annual report of the operations of the Wine Grapes Marketing Board. Please take the time to read through the reports in this document. Growers’ should note that this report contains a draft copy of the minutes of the previous Annual General Meeting for perusal prior to the meeting that will be held in June 2007. This will enable members to revisit the meeting outcomes prior to attending meeting this year. What was becoming a difficult year in terms of a looming over supply nationally has been very quickly turned around by the actions of wineries (requesting reductions in tonnes produced) and the climate (dryer growing conditions and frost impacts). Now the industry is looking at a drastically reduced intake that has the potential to clear the stock overhang that has been progressively forcing down the prices that growers receive. The Board encourages all uncontracted growers to discuss with the winery of their choice opportunities for the future. It is becoming apparent in other regions that winemakers are starting to offer termed contracts to growers. Unfortunately the word is that these are only 3 year contracts which while being sustainable in the short term do not provide enough long term security. The industry may turn sufficiently that growers are provided with a degree of market power in relation to negotiations with wineries. A major concern that affects this region and the economy is the reduction in water allocations this year and continues to threaten the development of this region. The Board hopes that initiatives such as the federal government’s National Plan for Water Security will provide security for the region and the industry. In 2007 the Board introduced its new Strategic Operations Plan 2007 - 2011. This is in line with the NSW Government’s requirements under the Agricultural Industry Services Act that bodies such as the Board must provide a revised 5 year Strategic Operations plan annually. Copies of this plan were sent to all growers in November and digital versions are also available via the Board’s website. The 2007 year is going to be a very active year for the Board as it commences to go through a review of the activities and services that it provides to the growers of the region. The Board will again seek the ability to continue to operate in the area of terms and conditions of payment, research and development, promotion and other key services. Terms of Payment are extremely valuable to the industry and while they may not be fully acknowledged by growers it provides the cornerstone of stability to growers and the regional industry. Board Staff Changes The Board’s Technical Officer Jason Cappello was promoted to the position of Industry Development Officer following the resignation of Emma Grabham after almost 5 years service to the Board and the growers. On behalf of the Board I offer our sincere thanks to her for her valued service.

Statutory Compliance The following information is provided to comply with the reporting procedure and prescribed content of the NSW Government Annual Reports (Statutory Bodies) Act. Application for Extension of Time The Wine Grapes Marketing Board applied in writing to the Office of Financial Management for an extension in the time allowed to produce and publish its Annual Report for 2006. The extension was granted until 31 May 2007. The reason for the extension application was due to The Board’s concerns that the printing would not be completed to ensure that copies of the report are presented to Parliament within the timeframes of the client service plan of the Audit Office and statue. Agricultural Industry Services of the Board The Board functions under the Wine Grapes Marketing Board (Reconstitution) Act 2003. Under this legislation the Board has the following agricultural industry services: (a) the development of a code of conduct for contract

negotiations between wine grape growers and wineries,

(b) the development of draft contract provisions with respect to the sale of MIA wine grapes to wineries, including provisions with respect to:

(i) The prices to be paid by wineries, and (ii) The terms and conditions of payment to be

observed by wineries, in relation to MIA wine grapes delivered to them by wine grape growers,

(c) the promotion of private contracts for sales of MIA wine grapes to wineries by wine grape growers,

(d) the collection and dissemination of market and industry information, including the production and publication of indicator prices for MIA wine grapes grown in the Board’s area of operations,

(e) the conduct of research and development into plant health in relation to wine grapes,

(f) the provision of education and training in relation to wine grape production and marketing,

(g) the promotion (in association with organisations representing wineries) of wine made from MIA wine grapes,

(h) the promotion of region industry, including regional winemaking, within the Board’s area of operations,

(i) the representation of the wine grape industry in relation to the matters referred to in paragraphs (a) – (h).

Aims and Objectives The following have been established and are consistent with the industry services of the Board:

• ensure a system of orderly and stable payments; • improve the long-term viability of vineyards; • improve the quality and marketability of Riverina

winegrapes; • provide a resource for industry information and data;

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RIVERINA - WINE GRAPES MARKETING BOARD 4 ANNUAL REPORT FOR 2006

• increase awareness of the Riverina as a major producer of quality wine;

• improve the professional and technical skills of winegrape growers;

• improve communication and cooperation with wineries; and

• encourage and facilitate viticulture research. Management & Structure The Board consists of seven members, five of whom are elected by winegrape growers and two appointed by the Board. The elected members of the Board have a three year term that ceases February 2010. Board Members during 2006 • Bruno Brombal (Chairman - Executive) • Robert Bellato (Deputy Chair - Executive) • Lou Dal Nevo • Len Gullotta • Tony Baggio • Eric Berton (appointed by the Board in 2005) • Rodney Zuccatto (appointed by the Board in 2005) Meetings of the Board During the 12 months to 31 December 2006 there were 12 general meetings and 2 special meetings held. The Board holds general meetings the second Monday of each month. Special meetings of the Board are held on a needs basis. Board Member Meeting Attendance The following table shows the number of Board meetings held that were available (avail.) for members to attend. Attendance of general and special meetings are noted and the overall percentage attendance of each member. Members’ absences were due to leave, sickness or other work commitments. Avail. General Special % Bruno Brombal 14 12 2 100%Robert Bellato 14 10 2 86%Lou Dal Nevo 14 12 2 100%Len Gullotta 14 11 2 93%Tony Baggio 14 12 1 93%Eric Berton 14 11 2 93%Rodney Zuccato 14 11 2 93%

Board Staff From 1 Jan 2006 - 31 Dec 2006 staff members were: • Chief Executive Officer - Brian Simpson • Industry Development Officer – Emma Grabham

(permanent part-time) • Technical Officer – Jason Cappello • Office Manager – Gillian Conway Customer Access The office is located at 182 Yambil Street Griffith. The Board office is open 5 days per week 8:30am-5:00pm Monday – Friday (excluding public holidays and the Christmas and New Year period). Ethnic Affairs Priorities Statement Located in the ethnically diverse Riverina region of NSW, the Board represents fairly and equally the interests of all winegrape growers irrespective of their

country of origin. Board members and staff are sensitive to the cultural, social and religious differences of people of varying backgrounds. All constituted growers within the area of the Board’s jurisdiction have the opportunity to contribute to the administration of the Board and the policies by which it functions. They are encouraged to vote at Board elections and meetings as a means of registering their opinion of Board performance, and question decisions and policies. All views are assessed for their constructiveness without bias to race. The Board is committed to the principles of multiculturalism and will continue its strategies as outlined in the above paragraphs. Summary of Operations The following summary of operations provides a brief of the activities conducted and meetings attended by the Board in 2006. The Board encourages growers to approach its members and the staff to seek further details about any of the activities outlined in the following operations and activities brief of 2006. Operations and Activities Brief for 2006 Please read through the following activities of the Board for the 2006 year. Many acronyms are used within the following – a listing for these is in the front of the report. In 2006 the Board actively participated with the local Councils to develop a road safety campaign following on from concerns of road spillage of winegrapes during previous harvests. Local Councils were also concerned that the movement of harvesters at night would pose a road risk to other road users. The advertising campaign was part funded by the Board and Council’s and went to air on local television and radio stations. The Board also participated in the initial consultative stages of Murrumbidgee Irrigations analysis of flow rate share and the costs of these to growers. The NSWWIA Research and Development Sub-Committee convened at the Board offices to discuss the priorities of growers in the region and the state. The outcomes of these discussions were directed through the NWGIC at Wagga Wagga. The Board commenced the development of a new website for growers that will be more functional for growers to access relevant information from the Board. Discussions with the service providers are currently occurring to develop a forum site. The CEO attended a PHA Group Training session for disease response protocols. It is hoped that other members of the Board will attend similar events. The training will assist in the event of an incursion of any plant pest or disease into the region. The Office Manager and the CEO attended night training in MYOB financial management software to enable more appropriate and useful accounts for meetings of members of the Board. In 2006 the Board commenced an overhaul of the financial management practices within its organisation. All tasks that are undertaken by the Board can now be tracked against the actual costs of wages and operating costs.

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RIVERINA - WINE GRAPES MARKETING BOARD 5 ANNUAL REPORT FOR 2006

The Board participated in the continued development of the federal growers’ body, assisting with interviews for the executive director position at the end of 2005 and assisting with the appointment of a chairman (Allan Newton). During the financial year the federal body started to actively undertake efforts for the growers in the Riverina, such as ensuring R&D priorities of growers are actively developed and the continued the work on the wine industry code of conduct. Many of the activities undertaken by the federal body are of direct benefit to the growers in the region. During May the development staff ran a series of workshops to develop the Board’s Ideal Conversion Project that is being developed to assist growers that may wish to convert from flood or furrow irrigation to high technology irrigation practices. With financial assistance from the GWRDC this project will become an asset to the regional industry for many years. The Board in May addressed a public meeting in Narrandera in relation to that shire councils interest in the development of a Hexachlorobenzene reprocessing plant for the region. Many organisations were similarly not in favour of this interest and the risk that having such a facility in the region and the Shire Council have since abandoned the idea. The Board was very concerned that the hosting of such a facility within proximity of the regions wine grape production and its possible impact that this may have on the perception of wine buyers for the region. Thankfully commonsense has prevailed in this instance. No other councils or shires are considering similar interest. The Board also hosted a Winegrowing Futures Steering Committee meeting to further develop the $13 million dollar project that is centred at NWGIC and is set to deliver benefits to the region in terms of directed research and development suited to the region. In June the Board participated in the National Winegrape Summit held in Melbourne. The summit was called for to try and bring to governments attention the problems being faced by growers national due to the downturn in prices being paid to growers and the continuing concerns of oversupplies of wine in the industry. As predicted the Government was not in a position to provide hand outs to the industry and suggested that the market must prevail. As it has turned out the industry has been dealt a bitter sweet blow by mother nature by reduced production. During the entire year the Board were very active in the national industry project titled Taking Stock and Setting Directions. The outcomes of this project have been reported to growers through the Vine Chat newsletter. However this project, funded by the Federal Government should prove instrumental in providing direction to the WGGA and all growers. The Board attended Wine Australia that was again held in Sydney at Darling Harbour. The event has continued to loose momentum with an apparent reduction in crowd numbers. If the benefits of attending such a promotional opportunity are not apparent to the participant wineries it is feared that such events may fail in the future. It is also not helpful that negative press surrounds the industry, such as oversupply and poor grape prices.

During 2006 the Board continued to provide to growers a regular newsletter in the new format Vine Chat. Every 2 months the newsletter was sent to constituted growers and contained relevant information for growers and important updates. The Board encourages feedback from growers on the items that they wish to see in the newsletter. It is an integral part of the communication process of the Board. In September the Board were hosted by the SDG at a dinner and presentation of the SDG priorities for the industry. This group has been formed to review the high level strategies that the wine industry needs to achieve to continue to be world class in the industry. As the issue of water availability became more a concern in the region the Board actively participated in workshops and meetings with the local supply company. The involvement was to ensure that the Board was able to present growers views in support of the Murrumbidgee Horticultural Council. The Board also meet with key figures in relation to Occupational Health and Safety on farms. The Board realises that growers need to be informed in the practical on farm management of such risks and is working to develop an on farm training program that will assist producers. The Board also attended and provided input into the continued development of an industry code of conduct. This is being managed by the WGGA on behalf of all growers nationally. It is critical that the industry adopts a suitable code that can benefit all sectors of the industry. It is important that growers are treated fairly and openly by processors. If growers wish to seek further information about the activities undertaken by the Board they can contact the Board office or download the Board’s newsletter from its website, www.wgmb.net.au. Funds Granted to Non-Government Community Organisations $500 (inc GST) was donated to the Charity Work undertaken by Westend Estate to support seriously ill children. Legal Change The Wine Grapes Marketing Board operates under the Wine Grapes Marketing Board (Reconstitution) Act 2003. No amendments to this Act occurred in 2006. The Board wrote a submission to the Minister for Primary Industries in 2006 seeking amendments to the Act, these being:

(a) enforcing the provisions for contracts to be complying that the terms and conditions of payment must adhere to the Board’s annual gazetted terms or be more favourable.

(b) Seeking better control over who was a grower in terms of the statutory fees and charges applied by the Board.

The response received by the Board was not supportive of the Board’s proposal to seek changes to all contracts and requested that the Board seek the views of all wineries on the matters.

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RIVERINA - WINE GRAPES MARKETING BOARD 6 ANNUAL REPORT FOR 2006

Economic or Other Factors There were no significant economic factors that impacted on or affected the achievement of operational objectives of the Wine Grapes Marketing Board. The Board did return during the third quarter of 2006 an amount equal to $1 per tonne on the fees and charges collected in 2006 this equated to $241,899. Management & Activities A review of the strategic operations of the Board was conducted in house during 2006. This was presented to growers in the WGMB Strategic Operations Plan 2007-2011 and Operating Budget for 2007 publication. The plan was adopted at a meeting of growers held in December 2006 at which time the rate for the Board’s grower fees and charges were set ($3.90 per tonne). A review of all staff was undertaken by Executive members of the Board in December. Research & Development The Board continued to operate its own laboratory facilities during the year for growers and received external funding for research work undertaken for a third party. Winegrape maturity sampling for grape growers continued with casual staff being employed to assist in sampling growers samples. For the 2007 (current) Vintage, 4 casual staff members were employed for this process. The Board obtained external funding to undertake trial work for a business. In 2007 the laboratory tested well over 1,500 samples. Human Resources During 2006 the Board employed 4 permanent staff, 3 casual staff member. Staff titles:

1 x Chief Executive Officer (CEO)

1 x Industry Development Officer (IDO)

1 x Technical Officer (TO)

1 x Office Manager (OM)

3 x Casual Staff (laboratory) There was a -2% variation in wages and salaries from the 2005 budgeted position. This was in relation to maternity leave taken by Emma Grabham during the year. Standard personnel policies and practices are in place with all positions being contracted or subject to signed offers and conditions of employment. Permanent staff performance are reviewed annually by the Board Executive members. From June 2006 the IDO (Emma Grabham) took maternity leave from her part time permanent position with the Board. Emma has since tendered her resignation from the Board. The position of IDO was offered to the TO (Jason Cappello) whom accepted and commenced duties in this role at the start of 2007. The Board is now in the process of seeking to employ a suitable person to undertake the role of TO to compliment the work that the IDO is undertaking.

Consultants Five (5) consultants were engaged in 2006 costing a total of $28,061 (excluding GST). Midstate Video Productions (production of a DVD for the Irrigation Conversion Project) $5,800 Murrumbidgee Horticultural Council (development of material - Irrigation Conversion Project) $8,684 Kanwhen (second party auditing of regional HACCP system) $7,905 Management Resource Plus (HACCP system review and management) $ 672 McGrath-Kerr Business Consultants (collation and preparation of Utilisation & Pricing Survey for the Riverina region) $5,000 Equal Employment Opportunity The Board did not set any planned outcomes for the previous year in relation to EEO. The Board is mindful of and does follow EEO principles when advertising, interviewing and selecting staff. (Jan-Dec) Total Permanent staff: 4 permanent Percent Women: 50% Percent Men: 50% Disability Plans The Wine Grapes Marketing Board is not required per NSW Public Sector Management Act Sch.1-3 to instigate a disability plan. Land Disposal No disposal of property or land occurred within the 2004 Financial Year. A revaluation of the property and land occurred in Dec 2004 as per NSW Audit Office agents request. Another revaluation will occur at the end of 2007 for the purposes of financial reporting. Promotion The Board contributed to the following promotional activities: • Sponsored the Riverina Wine Show event by

funding the trophy for best Semillon wine ($1,000). • Tourism Touchscreens ($968). • Airport Wine Display at Griffith Aerodrome. • Leeton Visitor Centre Wine Display. • Distribution of the Riverina Promotional DVD. Consumer Response The Board received one letter of complaint by a grower in relation to the Board’s involvement in publishing the indicator grape harvesting prices on an annual basis. The Board response was that publication of indicative prices for harvesting was a service to the growing community. No formal written complaints were received from members of the general public in relation to Board activities. Guarantee of Service The Wine Grapes Marketing Board has no formal guarantee of service provisions in place. The Board internal policy is that staff must return all grower and public contact at earliest convenience, with priority given to constituted growers.

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RIVERINA - WINE GRAPES MARKETING BOARD 7 ANNUAL REPORT FOR 2006

Payment of Accounts The details of financial performance for the each quarter are shown in the following table, it does not include payments to employees, returns to growers, Board members, superannuation funds and the Australian Taxation Office. The Board aims to make 100% of payments to creditors within 30 days of account receipt.

Number of Days

1st quarter

2nd quarter

3rd quarter

4th quarter

0-30 days $102,972 $97,064 $111,838 $61,364 30-60 days - - - - 60-90 days - - - - 90+ days - - - - $ Total $102,972 $97,064 $111,838 $61,364

% target 100% 100% 100% 100% % actual 100% 100% 100% 100%

Time for Payment of Accounts All accounts were paid for by the timeframe requested by suppliers. Risk Management & Insurance Activities The Board is currently insured for members and staff liability and professional indemnity. All assets are insured to their replacement value. The Board’s internal policy on purchasing is for all asset purchases to be recorded on the assets register. Disclosure of Controlled Entities The Wine Grapes Marketing Board does not have any controlled entities. NSW Government Action Plan for Women The Wine Grapes Marketing Board is not affected by the Action Plan. Occupational Health & Safety No reports of work-related injuries or illnesses were received during the year. The Board was also not advised of any proceedings against it under the Occupational Health and Safety Act 2000. During 2006 the Board did involve itself in OH&S matters on behalf of growers and held several meetings with NSW WorkCover to discuss the legislative impacts on growers of the new legislation that was introduced in the state. NSW WorkCover have offered to conducted training courses in the Riverina for growers to ensure that they are knowledgeable and compliant. The other important issue raised was the use and operation of hydraulic post drivers. This piece of farming equipment is critical in the management of vineyards, both development and maintenance. Unfortunately the standard equipment that is common across the industry has been declared an unsafe system of work by NSW WorkCover. WorkCover has formed a committee to review and recommend safer equipment. The Board will participate in the testing of this equipment for the wine industry. Waste The Wine Grapes Marketing Board has not moved to implement a written waste reduction policy. All paper that contains information of a non-confidential nature is recycled within the office and then disposed with any confidential material which is securely shredded.

Numbers of Executive Officers The Board currently has one Chief Executive Officer and the position is not receiving a remuneration package greater than or equal to Senior Executive Service level. Freedom of Information Act The Board received 31 requests (10 in 2005) for information under the provisions of the Freedom of Information legislation. These related directly to growers own farm details held by the Board. No charges or fees were requested for FOI requests and these were generally completed within 24 hours of receipt of the application. Electronic Service Delivery In 2006 the Wine Grapes Marketing Board re-developed its internet site (www.wgmb.net.au). The site continues to host Board newsletters and information updates for growers. The Board also uses facsimile, and email to deliver weather and pest reports to growers during the growing season. Information on meetings are sent via SMS to growers willing to receive these. Appointed Auditors The NSW Audit Office appointed KPMG Pty Ltd from Albury as its agent for the 2006 Audit. Annual Reports The Board produced 550 copies of this Annual Report to enable it to be sent to all constituents and to comply with statutory requirements. Annual reports cost $5.69 per unit (inc. GST). Legal Matters The Board’s solicitor is Mr Phillip Alvaro of Griffith NSW. There are no legal matters pending with the Board. During 2006 there were two breaches of the Wine Grapes Marketing Board (Terms and Conditions of Payment) Order 2006 by Evans and Tate Wines and Southern Highland Wines. These wineries were directed to make all payments to growers via the Board offices to ensure that compliance occurred to the interest owing to the growers. Southern Highland Wines were 14 days late on the 1st payment, 38 days late on the 2nd payment and 32 days late on the final instalment. Evans and Tate Wines were 7 days late on the 1st payment, and 11 days late on the 4th payment. Payments to growers were settled with the company making a total of 6 payments. All interest charged in accordance with the legislative provisions of the Act were charged at a rate of 14% per annum (calculated daily). Interest on all defaulted grower payments were forwarded to the growers that this impacted upon. Financial Year 1st January to 31st December. This coincides with the collection of the statutory fees and charges. Conclusion On behalf of the Board staff that work for the growers of the region I would like to thank all the growers that have taken the time to call into the office and provide your views into the management and operations of the Board.

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RIVERINA - WINE GRAPES MARKETING BOARD 8 ANNUAL REPORT FOR 2006

2006 YEAR IN REVIEW Chairman’s Report - Bruno Brombal Again I would like to thank all wine grape growers that contributed to the Board’s efforts over the past 12 months. I also offer my thanks for the support shown to me personally through the Board elections. My resolve has been confirmed to continue to work on behalf of all growers. Difficult times for the industry The last few years have been extremely difficult for all grape growers in the industry as the returns continue to decline. Studies show that to survive for a limited number of years (2-3 years) growers need in excess of $6,500 per hectare across the vineyard on average ($2,630 per acre). With the low price offers in 2006 and across some wineries in 2007, coupled with yield restrictions and dryer growing conditions growers are continuing to erode the equity in their business. It does not take a rocket scientist to realise that the industry’s grass roots is suffering, regardless of your property size the decline has the potential to reduce grower numbers and even the quality of winegrapes being produced as growers seek to minimise costs across the vineyard. Saving Money on Farm The weather over the past two vintages has allowed growers to reduce their costs by minimising sprays due to the lower incidence of rainfall. An initiative that the Board has been made aware of is the use of purchasing groups to buy required chemicals. Initiatives such as these are areas that growers should explore with neighbours and friends in the growing community. Growers do have a better buying power when purchasing products in bulk. Federal growers body will need support During the year the Board has been very active working with the newly formed Wine Grape Growers Australia ensuring that the services it provides to growers nationally and within the Riverina suit the needs of the industry. This body will in future need individual grower financial support. Within the Riverina it is being proposed that growers will be asked to contribute voluntarily to the organisation in 2008. When such a proposal is in place the Board will no longer pay for the services it provides directly and will in effect reduce its current fees and charges to enable growers to pay into this organisation. Farewell to Industry Viticulturist During 2006 the industry said farewell to Mr Harry Creecy Senior Viticulturist with the NSW DPI. On behalf of all growers I offer our sincere thanks to the work that Harry has contributed to the industry over the many years he was employed within our region. A presentation and vote of thanks for his efforts was conducted during 2006 and coincided with the Riverina Vineyard Field Day that was conducted by the Board. Levy Return a Slow Process In 2006 the Board noted that with the higher regional crush figure it would hold a significant surplus in fees and charges from growers. To reduce this surplus the

Board moved to return these funds directly to growers and use the exercise to confirm the vineyard maps that the Board has on growers in its database. The Board returning $1 per tonne was an appropriate way to manage grower funds and the process was conducted to coincide with the Riverina Vineyard Field Day. However as many growers stayed away from the Field Day it has been a long and slow process returning these funds to growers. The decision was right to keep the fees and charges at the current rate of $3.90 per tonne and allow annual adjustments to the rate charged on growers. Given the reduction in tonnes for 2007 the Board will now need to utilise reserves to maintain the budgeted services for growers. 2007 Harvest The 2007 season looks like a massive reduction in the crops for the region and nationally. This will not assist growers bottom lines as the price increases appear not to have compensated for the tonnes decline. However the reduction in the national crush has and will assist bring the industry back into a batter balanced position. It will not completely wipe out the oversupply but will bring the stocks held position into a more comfortable position for the industry and puts growers into a better position to be able to negotiate a priced contract. Board Review of Legislation This year the Board’s current legislation ends and the power to set and enforce terms and conditions of payment may be removed leaving the Board with standard industry service provisions under the Agricultural Industries Services Act of NSW. The Board is seeking to secure these powers for a further period and may require the written support of the grower base to complete this. It is also important to note that the ability to set and enforce terms and conditions of payment needs the full support of the regions winemakers before government will support any legislative impediments to trade. In Conclusion The Board is now operating in its 74th year. It has quite a history and has been there for the industry. Please continue to support the Board, many growers continue to utilise its services. Growers should take the time and come and visit the Board offices to talk about the industry issues and find out what we offer. I would like to thank my fellow members of the Board for their work and effort over the past year and offer my sincere thanks to Len Gullotta from Leeton whom was not re-elected onto the Board. His views will be missed from the Board. At this time I would also like to welcome Pascal Guertin of Bilbul to the Board. On behalf of the entire Board and all growers I would like to thank the Board staff, in particular Emma Grabham who resigned at the end of 2006 for their continued dedication to wine grape growers of the region and representing our views at every available forum. Growers should try to attend all possible meetings as they provide invaluable information for growers and the opportunity for growers to speak with staff and members of the Board.

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Regional Grape Grower Associations The following grape grower associations’ are in the region. Growers are encouraged to attend the general meetings of these organisations. More information can be obtained from the Board or via direct contact with the representatives listed below. Hanwood Grape Growers’ Association Postal Address PO Box 321 HANWOOD NSW 2680 Contact Details Chairman Lance Hicken 6963 0418 Deputy Chair Rodney Zuccato 6962 5525 Secretary Steven Barbon 6963 0250 Treasurer Leo De Paoli 6963 0247 The association meets at the Hanwood Catholic Club approximately 2-4 times per year. If urgent matters arise the organisation can special meetings. The meetings of the organisation are open to all growers to attend.

Yenda Grape Growers’ Association Postal Address PO Box 350 YENDA NSW 2680 Contact Details Chairman Ray Zahra 6968 1421 (ah) Yenda operates within a committee structure in which a meeting of the full growers only occurs when the need arises. The Committee is selected each year and meetings are held on a needs basis. Growers can contact Ray if they wish to attend a meeting. Notices of meetings are also put on the notice board of the Yenda Diggers Club where all the YGGA meetings are held. Leeton Grape Growers Association There is currently no association for growers in the Leeton region. Leeton growers are asked to contact the Board for details of activities in the Leeton region.

Research and Development Report Report by Industry Development Officer Jason Cappello 2006 saw the R&D staff complete many projects funded during 2005/06 including the Baume Mapping trial, irrigation conversion project, MOG training package, & also projects including Viticare trials operated by the CRCV. I would like to thank Emma Grabham for her service and work during her time with the Board and industry, Emma’s effort and support to industry will be missed. The R&D program includes extension projects and research projects. The extension projects tend to be developing and communicating information to growers. Research projects are generally more at the data collection level. The following report outlines WGMB projects in each area. ASVO Growing Quality Winegrapes Seminar Annually the ASVO holds both a viticulture and winemaking seminar for all members of industry to

attend to hear latest research updates on particular topics. In July 2006 the viticulture seminar was ‘Finishing the Job’ – Optimal Ripening of Cabernet Sauvignon and Shiraz. The program had a range of topics covering many aspects of berry development during the ripening phase, effects of canopy and irrigation management to Shiraz and Cabernet production & flavour development tracking through berry sensory workshops. Copies of the proceedings can be made for growers wishing to read the details on each of the topics. Australian Wine Industry Stewardship Program (AWIS) This national project, headed by the WFA, is looking to provide the Australian industry with an environmental marketing tool. With international wine consumers becoming more environmentally aware the Australian industry is being asked to justify it’s ‘clean and green’ image. The Riverina region this season had most wineries collect grower information to demonstrate grower’s commitment to sustainable management of our natural resources. WGMB is involved in the project through the local committee to ensure the information required is easy for growers to complete and to include it’s collection into our regional spray diary through a simple survey form. Grower Representation Grower representation by the research and development staff has continued to be a strong focus this year. Representation includes committees such as the WGMB HACCP Team, NSWWIA R&D Committee all the way up to the committee for the 2007 Australian Wine Industry Technical Conference other avenues are more direct focusing on straight liaison with wineries or local authorities. Mothballing the Vineyard During the 2006 the term “mothballing” had become very prominent in many winegrowing districts and was starting to flow into the Riverina with the changes in winery demand for fruit. The Murray Valley Winegrowers body sought funding for a committee to investigate successful and feasible management options for vineyard operators to implement in the event of having no buyers for the upcoming grape crop yet still wanting to maintain the vineyard plantings to meet demand once the industry supply was balanced. WGMB was a part of the committee along with many growers, grower representatives and key industry researchers. 4 key techniques were raised by the committee as options for operators to implement as a method to reduce vineyard input costs and fruit production. The techniques included chemical removal of fruit, mechanical removal of fruit, minimal input vineyard management & severe winter pruning. The option of no input vineyard management was deemed to have more detrimental affects to the vineyard than benefits and it would be more economical to remove the vineyard completely. NSWWIA R&D Committee WGMB along with many key industry representatives from the Riverina and other NSW growing regions meets twice per year to decide on key research priorities for the NSW wine industry. The research

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priorities cover both viticulture and winemaking items with 13 areas in viticulture currently being investigated through the NWGIC winegrowing futures program and many leading industry institutions. Vineyard Field Day WGMB hosted the 2nd Vineyard Field Day in September of 2006 at the Griffith Showground. The field day provides growers with the opportunity to source information on most aspects of the winegrape growing industry. The field day included 22 static exhibitor displays and a seminar series. The weather complimented the event allowing growers to take time to attend the seminar series, collect the $1 per tonne levy return and discuss with exhibitors latest information and services in the industry. With the announcement of the Murrumbidgee Farm Fair changes at the time of the WGMB VFD questions were raised to the sustainability and viability of WGMB continuing the VFD annually. Attendees of the VFD gave positive feedback for a proposal to involve the VFD into the larger field day event proposed for the Griffith Showground site. WGMB has moved to sponsor the Riverina Field Days in 2007 and be involved in this larger event for the entire region which will benefit growers and exhibitors involved in the VFD.

Vineyard Field Day Seminar series The 2006 VFD had 6 presentations on the latest local research and pressing topics leading into the 2006/07 growing season. The hot topic for the day was a presentation by Dr Michael McCarthy ‘Hitting the Cap & the Quality’. Dr McCarthy who’s attendance was sponsored by Casella Wines which was a major benefit to the local industry and his involvement was appreciated. The NWGIC made significant contribution to the day having 5 very valuable presentations on the latest local research projects and topics covering vineyard management techniques such as vine grafting to help with the industry oversupply issue. At the completion of the seminar series a presentation and public congratulations was made by WGMB chairman Bruno Brombal to outgoing NSW DPI district horticulturist Harry Creecy on behalf of the local industry. Harry has worked in the region for many years advising growers on production issues and was instrumental in the regional tonnage forecasts.

Vineyard GIS Mapping Database During 2006 through the return of fees and charges and the focus of vineyard yield production by many wineries the aerial mapping service WGMB was well utilised and vineyard planting details updated. The aerial maps taken in 2003 has been utilised to provide vineyard details for each block grown on each individual property. The update and input of the latest information has taken this system to the closest known dataset for total planted hectares in the region of each winegrape variety. Work to improve the 2003 database and image to include new plantings is being followed up aiming to bring the accuracy of the system closer to 100%. The information has many benefits for the local industry particularly with crop forecasting, natural disaster events, and managing disease or pest outbreaks. Growers with vineyards developed prior to 2003 can source property maps from the Board office. Vintage Grape Analysis Laboratory The Wine Grapes Marketing Board vintage grape analysis laboratory has once again seen an increase in grapes sampled with over 1200 samples processed in 9 weeks during 2007 compared to 1190 samples over 15 weeks in 2006. The Board undertook analysis for a range of customers; Riverina growers, research companies and out-of-area growers. The laboratory now runs as a cost free service for constituted growers. This is achieved by a fee-for-service rate charged for any analysis completed for non-levy paying parties. All levy paying growers are welcome to use this service during vintage. Below is a breakdown of the varieties analysed through the vintage lab for 2006 and 2007 vintages.

Laboratory Sample Breakdown Variety 2006 2007 Shiraz 536 541 Cabernet 276 333 Semillon 150 115 Merlot 74 108 Chardonnay 72 63 Others 82 65 Total Samples 1190 1225

Growers at the 2006 Riverina Field Day

WGMB Chairman Bruno Brombal presents a gift of thanks to retiring Harry Creecy

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VITT Groups WGMB & Suncorp Metway are investing in a program for small regional pockets of growers to meet on-farm and identify their own information needs. Two meetings have been trialled in Leeton and will continue to operate and grow across the region. These groups will be facilitated by the WGMB with expert presenters on topics which the grower group will decide. The concept will look to provide growers with the information they want, when they want it and in a location which is comfortable for them. Initially this project will concentrate on setting up a small number of groups and co-ordinating with the local associations to get the structure right before extending the project out to larger numbers of groups. WGMB HACCP for Vineyards Program WGMB has for the past 5 years has operated the HACCP for vineyards food safety program. The simple to use program continues to be utilised by local growers and also meet the needs from all processors for food safety record keeping on farm. The program is easy to adapt for different food crops and now includes additional sections for the growing of Citrus and also Stonefruit through help from Kanwhen project management and the HACCP team committee. Growers needing to implement food safety programs on farm can contact the Board office for further details and training options. WGMB Weather Grower information service The past growing season appeared to be a simple and ideal fit particularly for cost management purposes with the current status of winegrape returns for all growers. The season resulted in reduced input costs for items such as chemicals and fertiliser but increased costs for items such as water and overall reduced the production for many growers across the district. Pest and diseases were almost non-existent in the region and growers were able to maintain low input practices through careful monitoring programs which were also a large benefit for the entire region. Water availability has become a greater issue currently and WGMB will continue to support growers with information services and latest research information from our industry colleagues.

Wine Grapes Marketing Board 2005 Annual General Meeting

Minutes of the Meeting held 20 June 2006 commencing at 8:03 PM

Yoogali Catholic Club, Yoogali New South Wales

1. Chairman’s welcome and apologies Present (108 Eligible Voters) Sergio Altin, Bruno Altin, D Allen, R Aramini, Asio Arcifa, D Agresta, Tony Baggio, Duncan Bains, Steven Barbon, Frank Battistel Glen Bavaresco, Terry Bavaresco, Tim Bavaresco, Ron Beer, Robert Bertollo, Alfredo Bertacco, Erildo Berton, John Bissetto, Mark Bonetti, Eugino Bordin, Bruno Brombal, Garry Bugno,

Dom Calabria, EH&J Carusi, Sam Ciccia, Peter Conlon, Bernard Connellan, Peter Cornale, Agostino Cristofaro, Peter Cremasco, John J Dal Broi, Louis Dal Nevo, D’Ambrosio Estates, Angelo D’Aquino, Joe D’Aquino, Gary Davidson, Sue Davidson, Leo De Paoli, Joe Del Gigante, Harley Delves, Andrew Desprez, Dhillon Farms, Vittorio Febo, Brian Foggiato, Rudolph Panazzolo, Livio Forner, Lino Foscarini, Foscarini A&M, Foscarini G&M, Dominic Galluzzo, Warren Gill, Corardo Guadagnini, Anthony Gulloni, Len Gullotta, Lance Hicken, Roger Hoare, Paul Hutchinson, Leo Ipploiti, Joe Joeky, Wayne Lander, Ralph Mallamace, Manente RG, Alessio Martinello, Joe Maugeri, Bruno Mazzon, Steven Menegazzo, Dennis Menegon, Jim Minato, Vince Monteleone, Morandin GL&AA&GB, Glenn Morris, George Nehme, Tony Pasquetti, Lorenzo Pellizzer, Willy Pilosio, Pizzol Management, Poscoliero P&CJ, Tom Previtera, Adrian Raccanello, Gavin Raccanello, Joe Raccanello, Peter Raccanello, Raciti S&C, Mario Ragusa, Bruno Reginato, David & Eric Rossetto, Rossetto G&M, Angelo Sartor, Serafin BG&JL, Dario Serafin, Phillip Seria, Singh & Kaur AS&S, Singh K, Sarbjinder Singh, Rinaldo Snaidero, Steffania Bros, John Strano, David Torresan, Giulio Toscan, Ernie Tropeano, Vasta S, John Vitucci, Don Vitucci, John Williams, Wood J&D, Ray Zahra, Allan Zalunardo, John Zandona, Adrian Zandona, Vince Zappala, Zordan G&S, Rodney Zuccato. Visitors: Scott Ward – Bayer, Richard Wales & staff – MIAVIS, Ian Laurie - Suncorp, Staff: Brian Simpson (CEO), Jason Cappello (TO) Invited Guests: Dick Thompson – Chair and John Chant – CEO (Murrumbidgee Irrigation), Geoff Scollary Director (National Wine & Grape Industry Centre), Stuart McGrath-Kerr = Secretary (Riverina Winemakers Association), Bill Calabria – President (Riverina Winemakers Association), Tony Moody – Economic Services Unit (NSW Department of Primary Industries), Adrian Piccoli MP (Member for Murrumbidgee), Mark McKenzie – Executive Director (Wine Grape Growers Australia), Frank Battistel – Chairman (Riverina Citrus), Peter Morris – CEO (Riverina Citrus) Apologies: The Honourable Ian Macdonald MLC (Minister for Primary Industries, The Honourable Tony Catanzariti MLC, Kay Hull MP (Federal Member for Riverina), Harry Creecy – Ex NSWDPI, Karen Hutchinson - Executive Director (Murrumbidgee Horticultural Council), Robert Black – Chairman (Coleambally Irrigation), Murray Smith – CEO (Coleambally Irrigation), Michael Ciccia, Cedric Hoare, George Nardi, Lou Cremasco – Chairman (MIA Vine Improvement Society), Emma Grabham – Industry Development Officer (Wine Grapes Marketing Board), Neil Carter, Franc Franco, Michael Ciccia.

2. Minutes of previous meetings Minutes of 28 June 2005, 2004 Annual General Meeting were presented. There being no changes proposed the following motion was raised. That the minutes be accepted as a true and accurate record of 28 June 2005, 2004 AGM - MOVED: Roger Hoare SECONDED: Dominic Calabria CARRIED

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3. Business Arising from the Minutes 3.1 R&D Funding Issues Professor Geoff Scollary Director of the National Wine & Grape Industry Centre spoke on the GWRDC funding of the centre for the next 5 years through the Wine Growing Futures project. This project would see a total of $13.684 million dollars being spent in the region and funding of a new Professorial position of Oenology ($1.25 million). 3.2 Harry Creecy Retirement Professor Scollary advised that following on from the recent retirement of Harry Creecy the NSW Department of Primary Industries would replace his position by the end of July 2006. 3.3 Alternative Uses for Wine Grapes The Professor was asked if there was any funding to investigate alternative uses of winegrapes? He replied by advising that no there was not and that the research would be placing an emphasis on winegrapes for the production of quality wines.

4. Chairman’s Report – Bruno Brombal Due to the meeting needing to discuss several options growers may wish to consider in the management of their vineyards the Chair did not verbally deliver his report. He instead asked that the growers accept his report as written in the Annual Report. That the Chairman’s Report for 2005 be accepted: MOVED: Bruno Brombal SECONDED: Sam Ciccia CARRIED

5. General Business 5.1 Financial Report – Brian Simpson Chief

Executive Officer Growers were presented with a summary of the Board’s financial position as presented in the Annual Report. Based on the increased tonnages being produced the Board had agreed that it would be providing a return on the fees and charges on all growers of the amount of $1 per tonne of production from 2006. The CEO asked that the financial report as presented in the Annual Report be approved by the growers in attendance. That the Financial Report for 2005 be accepted: MOVED: Roger Hoare SECONDED: Dom Calabria CARRIED 5.2 Mark McKenzie – Executive Director Wine

Grape Growers Australia WGGA is very concerned about the future financial viability of growers across the country. It has recently appoint an independent Chairman Mr Alan Newton (ex DAFF) he possess sound knowledge of the industry and the current issues confronting it. He will put WGGA in a sound position to commence dialogue with the government. The Growers were advised of the constitutional position of the new body and whom would have a position of the federal body. It will remain based in Adelaide until necessary.

The WGGA is taking on a number of new projects that have been funded by the federal government to look at assisting the growers. One was the Taking Stock and Setting Directions project that will look at the economics and structure of the industry. Mark talked about the outcomes of the federal summit and that it was a disappointing outcome for growers. He advised that the government does not like to interfere with the markets of industries as this can have unknown implications. The summit looked at management options for growers to consider, i.e. if you do not have a home for your winegrapes growers should look to mothball the vines. Other items such as the industry taskforce to look at creating better statistics for the industry and the wine industry charter which will involve the code of conduct that the industry is currently working on having in place as a voluntary code for 2007. The following questions were raised by growers: Q. Concern that the Government did not listen and only

used by the Minister to present his speech and then depart the meeting.

A. Mark agreed that the meeting was somewhat staged and constrained by the agenda.

Q. How will the WGGA be structured to ensure that South Australia does not have greater voting power that the other states?

A. The constitution has been drafted with a 75% majority being required to push issues through.

Q. Recently on ABC radio someone from the industry in Tasmania was saying that they still required winegrapes to be planted when the current vintage saw 200K tonnes of winegrapes left on vines or harvested to the ground?

A. The issue is due to demand of the wine style. Most regions in Australia cannot produce at the price point that is obtained by Tasmanian winegrapes.

Q. The industry needs wineries to stop buying grapes at low prices?

A. WGGA’s point of view is if you do not have a home for your grapes do not grow a crop for 2007. Nationally we need to reduce the vineyard tonnes by 30%. WGGA is now also requesting that wineries do the same to help reduce the crop loads for the 2007 vintage as well as removing aged wine stocks that are causing a problem.

There being no further questions the Chairman thanked Mark McKenzie for this presentation.

6. Other Business 6.1 Harry Creecy Retirement The Chair advised that Harry Creecy had advised of his retirement last week. The Chairman on behalf of the growers in attendance offered his vote of thanks. 6.2 Gino Vittuci Order of Australia Medal The Chair formally recognised the Order of Australia Medal given to Gino Vittuci for services in grower representation to the Industry Being no further business, the meeting was declared closed at 9:05pm.

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NSW Department of Primary Industries 2007 National Wine and Grape Industry Report Dr Ron Hutton, Research Leader NSWDPI The National Wine and Grape Industry Centre (NWGIC) is expanding its wine industry research at both regional and national as well as international levels. As a Centre, we remain committed to the enhancement of viticultural and oenological practice for the continued improvement of the wine industry. A holistic approach to research is the underpinning philosophy of the Centre’s R, D&E programs. From studies of the grapevine root zone to the behaviour of the vine itself in terms of its ability to accumulate reserves for sustained productivity and their ability to maximise nutrient and water use efficiency, the aim is to identify key factors to enhance grape quality that will, in turn, enhance wine quality whilst minimising input costs. Wine, as the finished product, is also examined with emphasis on factors contributing to quality defects. A common thread to all investigations is the implementation of sustainable vineyard management practices to minimise off-farm impacts on the environment. This includes studies to develop bio-controls for the key diseases and pests that have detrimental effects on grape and wine quality.

Funding support is provided by the Grape and Wine Research and Development Corporation (GWRDC), the Cooperative Research Centre for Viticulture (CRCV), Charles Sturt University (CSU) and the NSW Department of Primary Industries (DPI NSW). Financial and in-kind support is also provided through regional grower associations, the Regional Innovation and Technology Adoption (RITA) and Regional Development Initiative (RDI) programs of the GWRDC to provide a mechanism for local evaluation of newly developed technologies.

Strong links have been established with industry to ensure that the research is applicable, timely and easily adopted, and adds value to the end-product. In terms of Research and Extension, the Centre seeks to:

• improve the competitiveness and profitability of the NSW Industry

• improve and tailor quality to meet consumer demand

• improve the environmental sustainability of the Industry.

In the last 12 months, the NWGIC has continued to grow in strength and commitment to the wine industry in NSW and at the national level. We are pleased that we maintain a good working relationship with the NSW Wine Industry Association (WIA), a founding member of the NWGIC. A submission by the NWGIC through its Industry partner, NSW WIA, to secure strategic R&D funding for NSW over the next 5 years has been accepted by the GWRDC and a research contract between GWRDC and CSU, the NWGIC signatory on behalf of the research alliance partners, was signed on 27 July 2006. The GWRDC has placed strong emphasis on its desire to build capacity at Wagga to facilitate delivery of R, D&E outcomes for the benefit of both NSW and the national wine and grape industry. The proposed Winegrowing Futures program (WFP) is linked to GWRDC’s 5-year plan and offers a balanced and strategic R, D&E portfolio. The WFP is structured into themes that address industry priorities in research, knowledge management and extension. It will enable the NSW wine industry to target its key priorities and underpin the outcomes desired by the industry through provision of whole-of-industry solutions. Although the program is focussed on national issues, the research will be carried out on a regional basis within NSW. However, the impact of the research outputs will be communicated at both state and national levels. For this reason, the GWRDC has also made considerable funding available within the WFP to support a national communication strategy. The total value of the proposed plan exceeds $31 m over 5 years with an approximate 1:1 cash contribution from GWRDC and an equivalent in-kind contribution from the Centre Partners (NSW DPI and CSU) and the NSW Wine Industry.

WINE FUTURES PROJECT Summary of WFP Themes Theme 1: Program management and industry linkage. The object of this theme is to ensure proper management of the Winegrowing Futures program to ensure that the research and extension activities lead to commercial success in the market place. Theme 2: Vine health and the vine environment. This theme has three discreet areas of activity which are based on industry priorities for non-botrytis bunch rots, Botrysphaeria and young vine decline. Field sites will be established in the Mudgee, Hunter Valley and Riverina regions.

RuralPhotos.com

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Theme 3: Factors that impact on the multi-seasonal variation of vine productivity and grape composition. This theme aims to target optimum vineyard water and nutrient applications to enhance vine performance and improve berry quality by:

• Improving knowledge of assimilate and water movement through vines and bunches

• Enhancing understanding of the perenniality of nutrient and reserve dynamics in vines, and

• Determining impact of selected climatic influences on vine and berry development

The field sites that will be established for this theme are in the Riverina and Hunter Valley regions. Theme 4: Optimising resource use and protecting the environment. There are two components to this project that will be investigated in both the Riverina and Hunter Valley regions:

• Improving vineyard water and nutrient use efficiency

• Predictive modelling of grapevine production using remote sensing techniques

Theme 5: Matching wine composition to consumers. Consumer sensory analysis will focus on Semillon as the variety of particular interest to the Hunter Valley and Riverina wine regions of NSW. Field sites will be established in these regions to characterise the three classic styles of Semillon produced in NSW:

• Icon Semillon from the Hunter Valley • Workhorse Semillon from the Riverina • Icon Botrytis Semillon from the Riverina

Theme 6: Knowledge management and capacity building. This theme combines all components of the entire WFP and is the project for which the communication of research outputs as outcomes for improved industry production practice will be delivered. A key component of this theme is a survey of growers throughout NSW. The survey is being conducted to establish base line data for future research and development programs. The information gained from the survey will then be used for extension purposes to deliver practical outcomes to both grape growers and researchers. Summary NWGIC Project activity Irrigation and nitrogen management and the role of cytokinins Cytokinins are key metabolites in regulating shoot growth. Their root-to-shoot transfer occurs via the xylem and is therefore dependent on transpiration. Their translocation is dependent on water supply, and cytokinin production (predominantly in the roots) is dependent on nitrogen supply, resulting in a strong relationship between cytokinin and nitrogen levels in the xylem. In addition, cytokinins retard leaf senescence

and increase flower numbers in spring. Our current research on rootstocks suggests that xylem cytokinin levels are related to shoot growth and flower numbers in grapevines. Other work on Shiraz has shown significant differences in vine balance between vineyards in the Riverina. This project will give us a better understanding of grapevine vigour and adaptation to stress, and will have a significant impact on how vines are managed. Contact: Dr Bruno Holzapfel and Stewart Field Floor management systems The project has been completed. The scope of investigation and final outcomes are as follows. The effect of three different ground cover treatments on Chardonnay grapevines in two regions was investigated. The treatments were bare soil maintained with herbicides, a partially vegetated treatment with bare soil under vines and a permanent sward in inter-row, and a completely vegetated vineyard floor. Increasing ground vegetation decreased soil moisture and petiole nutrient status, and strongly reduced vine growth. After three years under the vegetated treatments, grape yield was reduced and grapes had an increased sugar to acid ratio. These effects were much stronger under hot than mild climatic conditions. Under hot and dry conditions, maintaining a vegetated vineyard floor requires careful management to avoid excessive competition between vines and sward for water and nutrients, especially at critical stages such as berry set. The effect of permanent swards compared to bare soil (repeated herbicide treatment) on soil microbial counts was examined in cool and warm climate vineyards in NSW. Hot water extractable soil carbon (HWC) in the vine row was increased by 73% within three years of allowing a sward to develop. The grapevine rhizosphere bacterial population was dominated by cellulolytic bacteria in both climates. Most of the soil bacterial and fungal counts were greatly decreased by herbicide treatment. In both the under-vine and inter-row soil, HWC was positively correlated with fungal counts and with cellulolytic, pseudomonad, copiotrophic and oligotrophic bacterial counts. At both the warm and cool climate sites, soil cellulolytic bacterial counts were positively correlated with soil HWC and were significantly increased by continuous plant cover within and between vine rows. The transition to low input sustainable vineyard management practices requires a long-term approach. Future trials will be based on the outcomes of this study, along with industry consultation and participation. Results will be used to reduce reliance on agrochemicals (pesticides, herbicides, fertilisers) and to maintain cost-effectiveness and wine quality without compromising the environment. For further details on this study please see the GWRDC final report: CSU01/01, “Floor Management Systems to Reduce Vineyard Inputs and Improve grape quality.” Contact: Dr Ron Hutton, Dr Dejan Tesic and Dr Melanie Weckert

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Influence of irrigation and fertiliser management on movement of water and nutrients within and below the root zone of vines. The project has a strong focus on grape growing practices in the Riverina and is being run by the NWGIC in collaboration with CSIRO. The Riverina sites are all planted to Chardonnay and include both drip and flood irrigated vineyards located on heavy, medium and light soil types. The primary objective of the project is to determine the water, nitrogen and phosphate losses from vineyard systems under different irrigation and nutrition strategies over a range of soil types. An important component involves investigation of plant–soil interactions that relate to water and nutrient uptake and mineral composition of grapes. The trial is designed to better equip growers to manage their irrigation and fertiliser requirements. With funding from the CRC for Viticulture to the value of approximately $1.2 million over three years and financial contributions totalling $117,000 from commercial partners, including the Wine Grapes Marketing Board at Griffith, Murrumbidgee Irrigation Inc., Sentek and Horticulture Australia Limited, the project is now in its final year.

Water and nutrients applied to vineyards move through the soil for uptake by vine roots. Some will not be used, however, and this is the component under investigation in this study. The work is directed towards improving the sustainability of grape production, with consideration of vine nutrient uptake requirements under varying vineyard environments, nutrient utilisation, water use efficiency and economic and environmental factors. It has already been demonstrated that the early part of the season is when excessive drainage of irrigation water is most likely to occur. In some cases it may also be shown that nutrient needs are met with lighter applications of fertiliser. The project will provide industry benchmarks for existing irrigation and nutrient strategies against which the impact of the proposed wine industry Environmental Management System (EMS) framework can be evaluated. It will also endeavour to improve the understanding of the long-term effects of irrigation and nutrition management on vineyard soil properties such as structure and salt accumulation and vineyard environment including drainage water and its

composition. It is hoped that with improved irrigation management the amount of deep drainage containing nutrients can be minimised. To complement measurements of nutrient movement through the soil profile, vine nutrient requirements are also being quantified at each site by sampling petioles, shoots and fruit at key growth stages. Nutrient requirement for vine growth during the season has been estimated from analysis of these plant samples for nitrogen, phosphorous and a range of other elements. Vine yields, particularly if used in conjunction with petiole analysis, can therefore provide a useful indication of fertiliser requirements for the following season. With nitrogen, for example, removal ranged between 1.7 and 2.2 kg nitrogen per tonne of fruit. Across the six vineyards, this translated to 15.3 kg N/ha for young vines yielding at 7.4 t/ha, and 46.6 kg N/ha for older vines with a yield of 23 t/ha. Results have shown that if fertilisers are applied in amounts that approximately match vine requirements, the potential for loss of excess nutrients from the vineyard is reduced. This may involve applying nitrogen to better match actual requirements and key uptake periods, and managing irrigation to ensure nitrogen remains in the root-zone for a longer period. This project will generate new irrigation management knowledge in the key industry priority areas of increasing water and nutrient use and deliver solutions to minimise the impact of viticulture in the inland production regions of southern Australia. Contact: Dr Ron Hutton Dr Jason Smith and Dr Bruno Holzapfel Bunchstem and berry development in Merlot and Cabernet Sauvignon The Australian wine industry demands a consistent supply of high quality fruit for winemaking. Therefore, grape quality and its variability are seen as high priorities. Bunch development, structure and size, as well as colour development, ripening rate and asynchronous ripening, are critical issues. This study will contribute to our understanding of the physiological processes and morphological changes involved in the development of the bunchstem in relation to berry maturation and composition. Bunchstems contain an important vascular transport system supplying the grapes with nutrients and sugar. It is not well understood how early bunchstem development from flowering to veraison affects berry ripening and grape composition. The fertilisation of a flower and its numbers reflect on bunchstem and berry development. Differences in fruit set affect berry size and number, as well as the bunchstem. The structure and properties of the bunchstem influence the supply of minerals and carbohydrates to the berry through the vascular bundles (xylem, phloem) during development, but they become particularly important during berry ripening. Berry and bunch disorders have been related to nutritional imbalance or supply of carbohydrates. Fruit set—and therefore crop size—are affected by the availability of sugar (inflorescence necrosis), zinc (poor set – berry drop) and boron (hens and chickens). Bunchstem necrosis is affected by the availability of

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calcium, magnesium, nitrogen and sugar. Vineyard management techniques that affect bunchstem development could have a large impact on grape maturation and quality. Contact: Dr Bruno Holzapfel and Ms Aude Gourieroux Management of non-Botrytis bunch rots Fungal rots of grapevine berries cause economic losses to grape and wine production worldwide. They are a particularly serious problem in areas where rainfall is common during the ripening period. The most commonly encountered rot of the ripening grape berry is grey mould, caused by the fungus Botrytis cinerea, but less is known about the many other organisms involved in bunch rots. The biology of non-Botrytis bunch rots is diverse: aside from causing yield losses, some seriously affect wine quality, producing off-flavours (e.g. bitter rots, ripe rot), colour reduction (e.g. bitter rot) or production of mycotoxins (e.g. Aspergillus black moulds). These organisms include fungi such as Greenaria uvicola and Botryospheria spp. Recently, Colletotrichum acutatum has been identified as a major cause of bunch rot of grapes in subtropical grape-growing regions. Initial symptoms of this disease include a loss of berry turgor and a characteristic bitter taint to the fruit. Stems of bunches may also be affected. As the disease progresses, a salmon-pink discharge of conidia is observed. Berry drop can occur in infected bunches, and yield is affected. Management of non-Botrytis bunch rots has been unsuccessful, since strategies for their control have relied on the chemical and non-chemical methods used for the control of Botrytis cinerea. At present, there are no acceptable control measures in place for the management of bitter rot (Greenaria uvicola) and ripe rots (e.g. Colletotricum spp.). There are only limited control measures for rots regarded as secondary pathogens colonising grape berries after B.cinerea infection (e.g. Alternaria, Aspergillus). Current research aims to characterise more fully the organisms involved in grape berry diseases and to evaluate both fungicidal and non-chemical control methods. This project will address the reduction of bunch rot incidence and severity and evaluate control methods that are environmentally sustainable. Contact: Associate Professor Chris Steel Understanding trunk diseases and their role in grapevine dieback and decline Semillon decline and trunk diseases have been identified by the NSW Wine Industry Association as major research priorities. This is not surprising, since little is known about trunk diseases, especially Botryosphaeria, and their effects on grape production in Australia. This project will provide information on whether Botryosphaeria should be of concern to the Australian grape and wine industry, particularly in relation to the regions that are most at risk. It will provide information on the biology and lifecycle of Botryosphaeria and determine the most sustainable, economic and environmentally sustainable way of controlling the disease.

Diagnostic tools to determine whether the disease is present in grapevine material before symptoms are visible will be developed. These tools may be incorporated into existing testing services available through the NSW Department of Primary Industries (Elizabeth Macarthur Agricultural Institute), the Department of Primary Industries Victoria, and the South Australian Research and Development Institute. Owing to the increased incidence of dieback and decline throughout Australian vineyards and the increasing need for clean planting material, the potential for adopting the outcomes of this research will be high among grape growers and nurseries. Contact: Dr Sandra Savocchia Organic control of powdery mildew This project has been completed. The scope of investigation and final outcomes are as follows. Powdery mildew can have a significant impact on yield and quality of grapes and wine if left untreated. Common methods of control in conventional vineyards include sulfur and synthetic fungicides. In organic vineyards sulfur is used. Unfortunately, sulfur can have significant impacts on beneficial mites, insects and micro-organisms in the vineyard. Our aim is to reduce these negative impacts in organic vineyards by finding alternatives for the control of powdery mildew. Preliminary studies conducted in South Australia have shown that programs using milk, whey, bicarbonates and canola-oil-based sprays may be used as alternatives to sulfur. As part of a national GWRDC funded project, our aim is to test the efficacy of these programs over three growing seasons in a warm climate such as the Riverina. Similarly, trials are also being conducted in Tasmania and South Australia. Our field trials will assess the effects of milk, whey, canola based oils, potassium bicarbonate and sulfur on the development of powdery mildew on bunches and leaves of Chardonnay and Cabernet Sauvignon. Results from trials conducted in 2003–2004 indicate that whey may have the potential to replace sulfur in organic vineyards. Other areas that are being investigated include the effect of spray coverage and canopy management on infection by powdery mildew. Contact: Dr Sandra Savocchia Water relationships of Semillon vines Semillon has been grown in the NSW Hunter Valley and Riverina regions for many years and produces wines that are acknowledged as being unique and outstanding examples of Australian region-specific wine styles. It is extensively blended with Chardonnay and other varieties to produce high-quality white table wine as well as straight Semillon varietal wines of the Hunter region that have great ability for bottle age. In the Riverina, sweet dessert wines made from Botrytis-style Semillon have gained both Australian and international recognition. There is considerable interest in Semillon, particularly in inland areas, where there is a short- to medium term shortage of this variety. Semillon, however, has specific characteristics that have made its management difficult: it is particularly susceptible to water and heat stress and

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produces less dry matter per litre of water than other varieties studied. This project will concentrate on vine–water relationships and irrigation aspects of this variety. By developing an understanding of the physiological causes for this variety’s susceptibility to water stress, specific guidelines for more effective irrigation management strategies will be developed to help all growers who grow Semillon. It will have direct benefit to the Hunter Valley and Riverina regions as Semillon is and has been the basis for the success in white wine styles from these NSW wine regions. Contact: Dr Suzy Rogier, Dr Ron Hutton and Dr Dennis Greer Post-harvest vine management effects on spring growth, fruit quality and yield in Semillon This project has been completed. The scope of investigation and final outcomes are as follows The aim of this research was to gain a better understanding of factors that influence the accumulation of reserves after harvest, and how this subsequently impacts on vegetative growth, yield and fruit quality. The longer term goal of the project is to identify management strategies that could be used to take more advantage of the long post-harvest vegetative period in Australia to influence vine performance in the following season. In the period between bud-break and flowering, before leaves are big enough to begin exporting carbohydrates to other parts of the plant, shoot growth is largely dependant on carbohydrate reserves stored in the vine during the previous season. In the Riverina and Hilltops regions of NSW, studies have shown that reproductive development and yield can be influenced by the amount of stored reserves. In Australia, the warmer climate and long post-harvest vegetative period means that photosynthesis after the fruit is removed can make an important contribution to the vines carbohydrate reserves. After an initial survey of 14 vineyards to assess variations in carbohydrate reserve accumulation between warm and cooler climate regions, four Semillon field trials around Griffith, Young and Harden were established. Treatments were imposed to change the amount of carbohydrates stored by the vines during the post-harvest period. Significant replenishment of carbohydrate reserves (Semillon) was found to occur in the post-harvest period. However, this was dependent on maintaining canopy function and photosynthesis for an extended period after harvest. In the Riverina, a combination of irrigation, warm temperatures, and a long post-harvest period provide such conditions and allow high amounts of carbohydrate reserves to be stored before leaf-fall. The post-harvest period in the Hilltops region at Young should also be of sufficient length to allow a similar recovery of reserve levels, but this appeared to be prevented by drought conditions and a lack of water for irrigation after harvest. When treatments were applied to change the amount of reserves stored after harvest, more than a two-fold

difference in vegetative growth (shoot growth rates, pruning weights) was generated between vines with high and low carbohydrate reserves. The effect was particularly strong in the Riverina, where high crop loads prevent the full replenishment of reserves before harvest, and vines are dependent on favourable post-harvest conditions to maximise reserve storage before leaf-fall; this period can be manipulated to manage carbohydrate reserves. Post harvest manipulation of vine capacity to accumulate storage reserves has resulted in:

• Up to 20% reduction in yield following one season of treatments.

• The post-harvest period plays an important role in determining vine performance in the following season.

• Vineyard management after harvest is important for vine productivity.

For further details on this study, please see the final report: CSU 99/2 “Identifying manageable factors determining carbohydrate accumulation in reserves and root growth of grape vines after harvest.” Contact: Dr Bruno Holzapfel and Dr Jason Smith Management of carbohydrate reserve accumulation as a tool for regulating vine productivity and fruit quality This new project will investigate the effects of carbohydrate reserves on the key stages of reproductive development, and will evaluate practical methods for controlling the amount of reserves stored in the vine before leaf-fall. The impact on canopy development will also be assessed and the implications of reserve management for fruit composition and wine quality will be determined. Trial sites will be established with Shiraz and Chardonnay in the Riverina and in vineyards in the neighbouring Gundagai region. These will provide a range of sites representative of other warm climate irrigated regions and ensure that the results are applicable to a major sector of the Australian wine industry. Because the relative importance of stored versus current assimilate for reproductive development is not well understood and carbohydrates are known to be important at key growth stages, the project aims to generate information on the partition of reserves within vines and the influence of variety and crop load on the seasonal dynamics of carbohydrate reserves. This will involve developing methods to assess the rate of starch synthesis or storage in vine tissue and to relate levels of inflorescence initiation to carbohydrate supply and canopy development. Information on the effects of carbohydrate reserve levels on inflorescence initiation and development will enhance understanding of the interactive effects of crop load and carbohydrate reserves on fruit composition and improve knowledge on the role of reserves in improving fruit-set, particularly under cool weather conditions. The study will have significant industry benefit by developing practical methods for managing the accumulation of reserves after harvest and a wood

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reserve test as a tool for crop forecasting and yield regulation. This will be made possible by providing a better understanding of factors that determine yield in the following season and capacity to reduce seasonal yield fluctuations and manage reserve levels for specific yield and fruit composition targets. Contact: Dr Bruno Holzapfel, Dr John Gray and Dr Jason Smith

Vineyard soil health and microbial biodiversity under different cover crop and floor management practices. The aim of this project is to assess improvements in ‘soil health’ by monitoring the populations of soil microbes under different vineyard cultural practices, with an emphasis on improving microbial biodiversity, suppressing soil-borne disease, and increasing nutrient uptake by the vine. Vineyard soil bacteria and fungi, especially those able to encourage the natural resistance of the grapevine to common soil and foliar diseases are being investigated. Disease control by microbial communities on plant roots has been shown to extend to systemic and foliar diseases through the activation of the plant’s chemical and physical defence mechanisms. This mechanism is referred to as Induced Systemic Resistance. The effects of floor management treatments on the grapevine’s own immune systems are being investigated and the role of mulches and composts in promoting grapevine immunity will be characterised. This 3-year PhD project funded by the Australian Research Council. Contact: Dr Melanie Weckert and Ms Marina Alonso

Biology and epidemiology of grapevine canker fungi, Botryosphaeria spp. Decline and dieback of grapevines is becoming an increasing problem for the viticulture industry in NSW. Recently, species of the fungus Botryosphaeria were isolated from grapevines exhibiting these symptoms. To understand the biology and epidemiology of the causal organisms, we aim to: (i) determine which species of Botryosphaeria are present in NSW vineyards; (ii) determine which species are pathogenic on grapevines; (iii) characterise the genetic diversity of strains; and (iv) screen fungicides for the control of these fungi. Information on the species and their biology and pathogenicity on grapevines will enable the development of appropriate management strategies for their control and may lead to the development of molecular tools to identify different species of Botryosphaeria. Contact: Dr Sandra Savocchia and Mr Yu Qiu (Michael)

Chemistry of an anti-oxidant system in white wine. An issue of critical importance to the Australian wine industry is that of random oxidation, typically seen as the development of a dark colour, sometimes referred to as browning, of white wine. The image of the wine industry depends upon the production of wine free from quality defects, and, consequently, considerable

attention has been paid to understanding the chemical processes that cause white wine browning. The chemistry of ascorbic acid and sulfur dioxide as an anti-oxidant system in a model white wine have been assessed to establish a chemical basis for enhanced loss of sulfur dioxide in the presence of ascorbic acid. These chemicals have long been used in a complimentary sense as a means of protecting white wine from oxidation. However, we have found that the presence of ascorbic acid is counterproductive to maintaining appropriate levels of sulfur dioxide, as it enhances the loss of sulfur dioxide from white wine. Other factors that influence random oxidation, including the role of copper ions, the colour of the wine storage bottle and light and temperature, are also being studied. Contact: Professor Geoff Scollary and Dr Andrew Clark

Does sunburn in grapes contribute to disease? Sunburn is a significant problem in a number of horticultural industries where fruit are exposed to high-light and high-temperature conditions. For some crops, up to 20% loss of production can occur as a result of sunburn. Much of Australia’s grape growing regions have climates that could cause sunburn in grapes, yet little or no research has been conducted in this area. Studies with other crops have shown that sunburn causes a change in the properties of the skin causing a loss in quality. In grapes, fruit quality would also be affected but, in addition, damage to the berry surface may make these fruit more susceptible to microbial infections. The aim of this research is to investigate the occurrence of sunburn in Vitis vinifera L. cv Chardonnay and correlate this with the incidence of pathogen infections. This project is funded from a CSU Competitive Grant. A technique called chlorophyll fluorescence is being used to quantify the degree of sunburn in the grapes (see Figure 2). Using this technique, we are measuring the amount of sunburn in the berries and then assessing what pathogens are present on them. The berries come from the Charles Sturt University (CSU) vineyard which is a relatively disease-free site and the Hunter and Hastings valleys where vineyards are more disease-prone. In another approach, using berries with a range of sunburn symptoms, we will inoculate them with some common fungal pathogens to see if sunburn does predispose the berries to pathogen infection. We are interested to determine how widespread the problem of sunburn is in the grape industry. If growers would like to contact us, and indicate the severity of the problem we would be most appreciative. Contact Dennis Greer at [email protected] for further enquires. Contact: Dr Dennis Greer, Dr Chris Steel and Dr Suzy Rogiers

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Report by Executive Director Dr Jim Fortune The Riverina provides a perfect illustration of how science, good practice and sound planning can bring success. We are in a competitive global market where our ability to produce high quality, reliable, products is an important strength and contributing to this is our unique rural R&D model. Australia’s wine industry decided many years ago that the focus of research should not be confined to solving problems if it was to help advance the industry. There had to be expansion of interests to production efficiency in the vineyard and winery, elimination of faults in wine, creation of a better understanding of the make-up of wine and investigation of ways to improve quality and develop new styles to satisfy the world’s various wine consumers. To provide this forward-thinking R&D component for rural industries the Australian Government in the 1980s established the Rural R&D Corporation model. The GWRDC is one of 14 such corporations. The model enables producers who privately are not in a position to support a high level of R&D investment to share in the benefits of an industry partnership with the Australian Government, which matches levy contributions from grapegrowers and winemakers. Other key features of the model are the involvement of stakeholders in determining priorities and setting directions. By regulation the corporations are required to prepare annual operational plans and five year R&D Plans and the Riverina region is familiar with this process having been part of the consultation process to formulate the GWRDC Five Year R&D Plan (2007-2012). Reflecting on the past Five Year R&D Plan (2002-2007) it is clear that the Riverina industry, assisted by the NSW Wine Grapes Marketing Board, has been able to grasp opportunities reflected in that plan. At the time of its formulation a different global business environment existed than today but the seeds were being sown for continuing expansion, with millions of cases of wine being delivered around the world each year and demand increasing for the styles of wine that the Riverina can produce. Riverina grapegrowers have accessed regional funding effectively through the GWRDC’s Regional Innovation and Technology Adoption program, demonstrating a

capacity to get to the core of what really matters. Examples include the development of a regional profile of local soils and climate, irrigation projects and a recently-completed project to identify grape production targets that are acceptable to winemakers and well as growers. The latter used measurement facilities at the WGMB and incorporated the increasingly important aspect of production economics. Apart from R&D investments that are specific to the region, there are major national research projects involving growers and winemakers who provide sites and information. These include the Soil and Water Initiative and the Winery Wastewater Study. Although we tend to see R&D in the form of specific projects the continuing investment is generating knowledge and skills all the time among grapegrowers and winemakers. R&D has indeed become part of Australian wine. GWRDC research planning and change While the recent period has been challenging for the Australian grape and wine industry, it has never lost the momentum and vision that comes from a strong base in R&D. This has been typified by the continued engagement of all contributors, from the smallest of operators to the largest companies, in the process to develop and describe the opportunities that need to be taken over the next five to ten years. All of the GWRDC Board and staff are working towards the future with the new five year plan and its associated operational plan to be place by July 2007. The GWRDC Board would like to thank all contributors who have freely provided their time, energy, experience and business acumen to ensure the processes have been robust. As part of its process to move into a new stage of development for the grape and wine industry, the GWRDC Board would like to acknowledge the input of its Executive Director, Dr Jim Fortune to the current and future five year research and development plans. Dr Fortune will be stepping down as Executive Director from July 2007 and the Board is commencing a replacement process.

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NSW Wine Industry Association Report by President David Lowe A busy year for the Association with activities across a range of areas. Highlights include participation at Wine Australia International 2006, production of a DL brochure for wine regions, a highly-successful NSW wine awards, and the production of the Fine Wines of NSW booklet in the Sunday Telegraph. The 2006 crop of 400KT (excluding NSW Murray Valley) was 10% up on 2005 vintage and represents a record crush. Prices softened as a result. The results of the pricing survey can be found on our web page www.nswwine.org.au. The commencement of the Winegrowing Futures program in 2006 concludes a process of negotiation between the Association and NSW DPI, Charles Stuart University and the Grape and Wine Research and Development Corporation. The program embodies the State’s research priorities and is a credit to the work put in by the Research and Development Committee under the chairmanship of Richard Hilder to identify and communicate these priorities to all levels. Other activities of the R&D committee include the continuing negotiations with NSW DPI regarding the development of a vineyard identification scheme for pest and disease management based on the Property Identification Codes used by the Rural Lands Protection Boards. The laborious process of liquor license reform remains in the hands of the Minister for Gaming and Racing after our Association made representations to the Minister’s staff. We have been assured on numerous separate occasions most of the wine industry’s requests will be met, yet the process of reform has not progressed beyond this. This is to the detriment of the regions who depend on being able to compete on an equal footing with their interstate competitors. The Association has started to engage in a subtle way to lift the profile of the quality and availability of NSW wine. This is never happening fast enough in my view but it seems to be going in the right direction. Much of the effort and success of anything we initiate is

dependent on the industry itself not just the executive. The platform for this has been the NSW Wine Awards which is currently in its third year under the Association’s administration. The NSW Government has picked up on the method of quality selection and is using the Top 40 wines for government functions. The NSW WIA assisted those wineries who participated in Wine Australia in July. Although it was a scaled back version from previous events it was well attended and exhibitors appeared to be happy with the results. The Association conducted the NSW Wine Awards for the third year and these are rapidly developing into a major platform for promoting awareness of the quality and diversity of NSW wines. Almost 800 entries were received. A successful tasting of the NSW “Top 40” was held in Parliament House in November. During the year a DL sized guide to the NSW wine regions was produced and reprinted with an updated listing of the Top 40 from the 2006 NSW Wine Awards. During the latter half of the year the Association, in conjunction with Tourism NSW and News Limited, was involved in the production of a 64 page guide to the Fine Wines of NSW. This was published in November and distributed as a free supplement with the Sunday Telegraph. In December 2006 the NSW government passed legislation declaring all of NSW, with the exception of the Sydney basin and a small area near Corowa, to be phylloxera free. This will deliver considerable benefits to the wine industry in the state by permitting free movement of grape material and machinery anywhere within Australia. There now need to be implemented programs of monitoring and surveillance by regions to ensure their phylloxera status is not compromised. The Association has been represented on the steering committee guiding the formation of the national grower body Wine Grape Growers Australia. At the August 2006 Annual Meeting David Lowe of Mudgee continued his second year of a two year term as president, while Chris Barnes of the Hunter Valley was re-elected Vice-president. Corporate Executive Members elected were Phil Laffer (Pernod Ricard), Phil Skinner (McWilliam’s), Brian Freeman (Freeman Vineyards) and Paul Dakis (Fosters Wine Group). Geoff Krieger (Brokenwood) is convenor of the Wine Tourism and Promotion group, and Richard Hilder convenes the R&D Sub-committee. Regional Executive members are Patrick Auld (Hunter Valley), Darren De Bortoli (Riverina), David O’Dea (Cowra/Orange/Mudgee) and Anne Caine (from Canberra district representing other NSW wine regions). The Chairman of the Wine Grapes Marketing Board, Bruno Brombal, is also on the Executive. Details on the Association’s regional members can be found at www.nswwine.org.au. The Association would like to acknowledge the invaluable support of Professor Geoff Scollary and Dr Ron Hutton from the National Wine and Grape Industry Centre, Barry Buffier and Doug Hocking from NSW DPI, Paul Judge from State and Regional Development, and Catriona Fraser and Jenny Arkell from Tourism New South Wales.

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2007 Riverina Delivery Information as at 26/03/07 Variety Tonnes

Crushed 2007 Total Tonnes Crushed 2006

06-07 % variation

Chardonnay 63,234 59,617 106.1% Chenin Blanc 779 1,153 67.6% Colombard 9,948 16,522 60.2% Doradillo 9 19 44.4% Marsanne 462 887 52.1% Muscat Gordo Blanc 3,721 5,057 73.6% Palomino 21 36 58.7% Riesling 3,940 4,997 78.6% Sauvignon Blanc 3,509 3,956 88.7% Semillon 29,712 43,680 68.0% Traminer 4,416 5,216 84.7% Trebbiano 2,361 3,752 62.9% Verdelho 4,629 6,154 75.2% White Frontignac 1,627 1,558 104.4% Botrytis Semillon Not recorded 1,493 N/A Sylvaner 26 21 125.0% Pinot Gris/Grigio 4,745 3,125 151.9% Viognier 1,702 1,320 129.0% Other White 169 197 85.6%

WHI

TE V

ARIE

TIES

Total White 135,012 158,760 85.0% Barbera 203 441 46.0% Black Muscat 11 186 5.9% Cabernet Franc 161 325 49.6% Cabernet Sauvignon 13,524 22,926 59.0% Durif 2,866 5,261 54.5% Grenache 180 278 64.6% Malbec 159 49 322.9% Mataro 803 1,561 51.5% Merlot 11,562 15,237 75.9% Petit Verdot 1,124 3,429 32.8% Pinot Noir 2,178 2,568 84.8% Red Frontignac 347 649 53.5% Ruby Cabernet 7,884 12,028 65.5% Sangiovese 537 594 90.4% Shiraz 42,186 62,069 68.0% Tempranillo 707 1,014 69.8% Zinfandel 532 781 68.1% Other Red 194 898 21.6%

RED

VARI

ETIE

S

Total Red 85,158 130,294 65.4% Totals 220,170 289,059 76.2%

The tonnes figures shown above are collated tonnage reports provided voluntarily to the Wine Grapes Marketing Board on a weekly basis by winemakers. The accuracy of these reports is therefore not the responsibility of the Board.

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WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

STATEMENT BY MEMBERS OF THE BOARD

Pursuant to the requirements of the Public Finance and Audit Act 1983, and in accordance with a resolution of the members of the Wine Grapes Marketing Board for the City of Griffith and the Local Government Areas of Leeton, Carrathool and Murrumbidgee, we declare on behalf of the Board that in our opinion:

1. The accompanying financial report exhibits a true and fair view of the financial position of the Wine Grapes Marketing Board as at 31 December 2006 and its transactions for the year then ended.

2. The report has been prepared in accordance with the provisions of the Public Finance and Audit Act 1983, and the Public Finance and Audit (General) Regulation 2000, and the Treasurer’s directions.

Further, we are not aware of any circumstance which would render any particulars included in the financial report to be misleading or inaccurate. Bruno Brombal Robert Bellato Chairman Deputy Chairman

Dated this day the 12 May 2007

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WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

INCOME STATEMENT for the Year Ended 31 December 2006

31/12/05 Note 31/12/06 $ $

REVENUE 74,145 Other operating revenue 2 87,81138,281 Interest 51,68210,390 Grants 3 16,746

794,835 Fees and Charges on Growers 4/13 701,377917,651 TOTAL REVENUE 857,616

EXPENDITURE 16,220 Audit Fees 13,6361,235 Bank Fees 1,123

51,458 Board Fees and Allowances 51,31711,873 Consultancy Fees 28,06139,670 Depreciation 37,5838,656 Fringe Benefits Tax 978

216,452 Other Administration Expenses 5 196,59424,216 Promotion -

219,468 Salaries and Wages 213,77130,839 Subscriptions 122,08735,825 Travelling expenses 28,623

- Impairment Loss 536,944 Employees Leave Entitlements 5,8555,406 Loss on Sale of Assets 189

668,262 TOTAL EXPENDITURE 699,870

249,389 PROFIT FOR THE PERIOD 157,746

The Income Statement is to be read in conjunction with the notes to and forming part of the financial report.

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RIVERINA - WINE GRAPES MARKETING BOARD 26 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

STATEMENT OF RECOGNISED INCOME AND EXPENSE for the Year Ended 31 December 2006

31/12/05 Note 31/12/06 $ $

- Net income recognised directly in equity -249,389 Profit for the period 12 157,746249,389 Total recognised income and expense for the period 157,746

The Statement of Recognised Income and Expense is to be read in conjunction with the notes to and forming part of the financial report.

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RIVERINA - WINE GRAPES MARKETING BOARD 27 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

BALANCE SHEET as at 31 December 2006

31/12/05 CURRENT ASSETS Note 31/12/06 $ $

536,399 Cash & Cash Equivalents 6 708,192 66,244 Trade and Other Receivables 7 65,096

300,000 Other Financial Assets 8 300,000902,643 Total Current Assets 1,073,288

NON-CURRENT ASSETS

635,120 Property, Plant & Equipment 9 615,425635,120 Total Non-Current Assets 615,425

1,537,763 TOTAL ASSETS 1,688,713

CURRENT LIABILITIES

57,311 Trade and Other Payables 10 44,00612,480 Employee Benefits 11 17,17769,791 Total Current Liabilities 61,183

NON-CURRENT LIABILITIES

8,505 Employee Benefits 11 10,3178,505 Total Non-Current Liabilities 10,317

78,296 TOTAL LIABILITIES 71,500

1,459,467 NET ASSETS 1,617,213

EQUITY

63,667 Reserves 12 63,6671,395,800 Retained Earnings 12 1,553,5461,459,467 TOTAL EQUITY 1,617,213

The Balance Sheet is to be read in conjunction with the notes to and forming part of the

financial report.

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RIVERINA - WINE GRAPES MARKETING BOARD 28 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

CASH FLOW STATEMENT for the Year Ended 31 December 2006

31/12/05 Note 31/12/06 Inflows Inflows

(Outflows) (Outflows) $ $

CASH FLOWS FROM OPERATING ACTIVITIES RECEIPTS

3,219,970 Wineries & Growers 1,298,43010,390 Grants Received 16,74640,486 Interest Received 42,92484,444 Other 90,196

3,355,290 PAYMENTS 1,448,296

(208,976) Employee Benefits (242,027)(665,519) Payments to Suppliers (661,373)

(2,455,844) Payments to Growers (355,026)(3,330,339) (1,258,426)

NET CASH PROVIDED BY OPERATING

24,951 ACTIVITIES 14 189,870 CASH FLOWS FROM INVESTING ACTIVITIES

(300,000) Payments for Held-to-maturity Investments -37,728 Proceeds from Sale of Fixed Assets -

(89,583) Payments for Property, Plant & Equipment (18,077)(351,855) NET CASH USED IN INVESTING ACTIVITIES (18,077)

(326,904) NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 171,793

863,303 Cash & cash equivalents at 1 January 536,399536,399 Cash & cash equivalents at 31 December 708,192

The Cash Flow Statement is to be read in conjunction with the notes to and forming

part of the financial report.

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RIVERINA - WINE GRAPES MARKETING BOARD 29 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Wine Grapes Marketing Board (the Board) is domiciled in Australia. The financial report was authorised for issue by the Board on 12 May 2007. Statement of Compliance The financial report is a general purpose financial report and has been prepared in accordance with Australian Accounting Standards adopted by the Australian Accounting Standards Board (“AASB”) and in compliance with Section 41B1 of the Public Finance and Audit Act 1983. The financial report of the Wine Grapes Marketing Board complies with IFRSs and interpretations adopted by the International Accounting Standards Board. The financial report is for the Wine Grapes Marketing Board as an individual entity. Proper accounts and records for all of the Board's operations have been maintained as required under Section 41(1) of the Public Finance and Audit Act 1983. Non for-profit status Under AIFRS, there are requirements that apply specifically to not-for-profit entities that are not consistent with International Financial Reporting Standards (IRFS) requirements. The Board has analysed its purposes, and operating philosophy and determined that it does not have profit generation as a prime objective. Consequently where appropriate the Board has elected to apply options and exemptions within AIFRS that are applicable to not-for-profit entities. Basis of Preparation All amounts are rounded to the nearest dollar and are expressed in Australian currency. The Board has elected to early adopt all applicable revised accounting standards as at December 31 2006. The financial report has been prepared on accruals basis and is based on historical costs and does not take into account changing money values or, except where stated, current valuations of non-current assets. Cost is based on the fair values of consideration given in exchange for assets. The preparation of a financial report in conformity with Australian Accounting Standards requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about carrying values of assets and liabilities that are not readily available from other sources. Actual results may differ these estimates. These accounting policies have been consistently applied by the Wine Grapes Marketing Board.

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RIVERINA - WINE GRAPES MARKETING BOARD 30 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. (a) Property, Plant & Equipment (i) Owned Assets Items of land and buildings are recorded on the fair value basis being the amount for which an asset could be exchanged between knowledgeable willing parties in an arm’s length transaction. Plant and equipment are stated at cost less accumulated depreciation (see below) and impairment losses. It is the policy of the Board to have an independent valuation of land and buildings every three years, with annual appraisals being made by directors. The property was valued by John Carbone, AAPI Certified Practicing Valuer on 16 December 2004 on the basis of current market value. Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment. Depreciation Depreciation is charged to the income statement on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. Land is not depreciated. The estimated useful lives in the current and comparative periods are as follows: Class of Fixed Asset Depreciation Rate Buildings 2.5% Motor Vehicles 20% Research Equipment 25% Office Equipment 11.25% - 25% Computer Equipment 20% - 33% Generally, physical assets with a cost of less than $500 are expensed in the year of acquisition. However, the Board has determined that all items of research, computer and office equipment which are easily transportable, be capitalised regardless of the cost of acquisition. See Note 9. (b) Financial Instruments (i) Non-derivative financial instruments Non-derivative financial instruments comprise investments in equity and debt securities, trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables. Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at fair value through profit or loss, any directly attributable transaction costs, except as described below. Subsequent to initial recognition non-derivative financial instruments are measured as described below.

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RIVERINA - WINE GRAPES MARKETING BOARD 31 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integrated part of Wine Grapes Marketing Board’s cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flows. Accounting for finance income and expense is discussed in note 1(j). (ii) Held-to-maturity investments If the board has the positive intent and ability to hold debt securities to maturity, then they are classified as held-to-maturity. Held-to-maturity investments are measured at amortised cost using the effective interest method, less any impairment losses. (c) Trade and other receivables Trade and other receivables are stated at cost less impairment losses. (d) Impairment The carrying amounts of the Board’s assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds it recoverable amount. Impairment losses are recognised in the income statement, unless an asset has been previously revalued, in which case the impairment loss is recognised as a reversal to the extent that previous revaluation with any excess recognised through profit or loss. (e) Employee Benefits Provision is made for the Board’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits expected to be settled within one year together with benefits arising from wages and salaries, annual leave and long service leave which will be settled after one year, have been measured at amounts expected to be paid when the liability is settled plus related on costs. Other employee benefits payable later than one year have been measured at the present value of estimated future cash flows to be made for those benefits. Contributions are made by the Board to an employee superannuation fund and are charged as expenses when incurred. (f) Trade and other Payables Payable amounts represent liabilities for goods and services provided to the Board. Trade and other payables are stated at their amortised cost. (g) Revenue Goods and services rendered Revenue from the sale of goods is recognised in the income statement when significant risks and rewards of ownership have been transferred to the buyer. Revenue from services rendered is recognised in the income statement net of fees & charges returned to growers, in proportion to the stage of completion of the transaction at balance sheet date. The stage of completion is assessed by reference to

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RIVERINA - WINE GRAPES MARKETING BOARD 32 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

surveys of work performed. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due, or the costs incurred or to be incurred cannot be measured reliably. (h) Income Tax The Board is exempt from income tax.

(i) Goods and Services Tax Revenues, expenses and assets are recognised net of the amount of the goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or part of the expense. Receivables and payables are stated with the amount of GST included. The net amount of the GST recoverable from, or payable to, the ATO is included as a current asset or liability in the balance sheet. Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising investing and financing activities which are recoverable from, or payable to, the ATO are classified as operating cash flows. (j) Finance income and expenses Finance income comprises interest income on funds invested, dividend income, gains on the disposal of available-for-sale financial assets and changes in their fair value of financial assets at fair value through profit or loss. Interest income is recognised as it accrues using the effective interest method. Dividend income is recognised on the date that the Board’s right to receive payment is established, which in the case of quoted securities is the ex-dividend date. Finance expense comprise interest expense on borrowings, unwinding of the discount on provisions, dividends on preference shares classified as liabilities, foreign currency losses, changes in the fair value of financial assets at fair value through profit or loss, impairment losses recognised on financial assets, and losses on hedging instruments that are recognised in the profit or loss using the effective interest method. (k) Board Activities The Board is not involved in the buying of wine grapes from growers and the selling of these grapes to winemakers. The Board’s legislation - Wine Grapes Marketing Board (Reconstitution) Act 2003 requires that wineries make payment for purchases from non-complying contracted growers and all spot market purchases as directed by the Board. The Board directs these wineries to apply to the Board for the ability to make payments directly to growers, provided Board fees and charges are deducted from the growers’ payment and forwarded to the Board as per the provisions in the Act. Two wineries paid through the Board this financial year. This is shown in the Statement of Cash Flows as winery receipts. See Note 13. Board fees and charges are deducted from payments made to growers. Payment dates are set by the Board in accordance with the Wine Grapes Marketing Board (Terms and Conditions of Payment) Order 2005 under the Act.

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RIVERINA - WINE GRAPES MARKETING BOARD 33 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

NOTE 2: OTHER REVENUE

31/12/05 31/12/06 $ $ 34,020 Fees & Charges 73,77540,125 Other 14,03674,145 87,811

NOTE 3: RESTRICTED FUNDS - RESEARCH FUND In 2005 the Board applied to the CRCV for funding of two projects (R & D survey and Viticare extension trials). The latter project commencing in 2006. The transactions for the year ended 31 December 2006 and the financial position at 2006 year end are detailed below:

31/12/05 31/12/06 $ $

- Balance on 1 January 7,273- CRCV Grant (Conversion Trial) 11,954

3,117 CRCV Grant (R & D Survey) - - CRCV Grant (Grape Maturity R & D) 3,042 7,273 CRCV Grant (Viticare Extension) -

- AWBC Grant (Pricing Survey) 1,75010,390 24,019

- Reimbursement -3,117 Research Outlays 24,0197,273 Balance at 31 December -

NOTE 4: FEES & CHARGES ON GROWERS For the 2006 vintage the fees and charges were $3.90 per tonne for the purpose of funding the grower approved budget, activities and services of the Board. Charges on growers represents the grower contribution to Board services and activities via the Statutory Levy. In 2006 returned levies represented both fees and charges remitted by wineries from non-constituted wine grape growers and a $1 per tonne return to all constituted growers. The following table shows the fees and charges received and returned during the year:

31/12/05 31/12/06 $ $

798,391 Fees and charges paid by growers 944,220

(963) Fees & charges returned to non-constituted growers (816)

(2,593)

Fees & charges returned to constituted growers (2004 liability) (128)

- Fees and charges returned to constituted growers (2006 liability)

(241,899)

794,835 NET RECEIPTS (Fees and charges retained) 701,377

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RIVERINA - WINE GRAPES MARKETING BOARD 34 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

NOTE 5: OTHER ADMINISTRATION EXPENSES Details of the components of this item are as follows:

31/12/05 31/12/06 $ $

7,170 Accountancy 11,818 34,624 Advertising, Printing & Stationery 51,490 1,649 Computer Expenses 6,639 5,967 Conferences & Seminars 654

11,700 Cost of Production Project - 473 Database Project Cost -

5,000 Donations 455 10,195 HACCP Project Management - 23,708 Industry Functions 11,934 14,220 Insurance 17,095 7,629 Legal Fees 7,836

10,612 Motor Vehicle Expenses 7,828 8,226 Office Expenses 11,064

19,092 Postage, Telephone & Facsimile 20,809 3,072 Rates 1,950 4,344 Research & Development Function 18,280

15,000 Research Project Payments - 2,000 Sponsorship 1,000 3,018 Staff training 396 4,747 Sundry 5,765

24,006 Superannuation 21,581 216,452 196,594

NOTE 6: CASH & CASH EQUIVALENTS

31/12/05 31/12/06 $ $ 362,850 Administration Account 476,443173,549 Grower Payments Cheque Account 231,749536,399 708,192

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RIVERINA - WINE GRAPES MARKETING BOARD 35 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

NOTE 7: TRADE AND OTHER RECEIVABLES Amounts owing to the Board at 31 December 2006 comprise:

31/12/05 31/12/06 $ $ 35,537 Trade Debtors 44,015

- Less: Allowance for Doubtful Debts (53)13,763 GST Receivable 9,11513,683 Prepaid Insurance -

3,261 Accrued Income 12,01966,244 65,096

NOTE 8: OTHER FINANCIAL ASSETS

31/12/05 31/12/06 $ $ 300,000 Held-to-Maturity Investments 300,000300,000 300,000

NOTE 9: PROPERTY, PLANT & EQUIPMENT

31/12/05 31/12/06 $ $

Land & Buildings Freehold Land at:

220,000 - independent valuation 16 December 2004 220,000220,000 220,000

Buildings at: 321,801 - at independent valuation 16 December 2004 325,914(8,374) Less accumulated depreciation (16,435)

313,427 309,479533,427 Total Land & Buildings 529,479

57,505 Office Equipment 66,192

(37,337) Less: Accumulated Depreciation (42,076)20,168 24,11667,246 Motor Vehicles 67,246(3,735) Less: Accumulated Depreciation (17,185)63,511 50,06146,114 Computer Equipment 37,129

(33,336) Less: Accumulated Depreciation (30,298)12,778 6,83132,103 Research Equipment 35,157

(26,867) Less: Accumulated Depreciation (30,219)5,236 4,938

101,693 Total Plant & Equipment 85,946635,120 Total Property, Plant & Equipment 615,425

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RIVERINA - WINE GRAPES MARKETING BOARD 36 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

MOVEMENT IN CARRYING AMOUNTS

Cost Land & Buildings

$

Research Equipme

nt $

Office Equipmen

t $

Motor Vehicle

$

Computer Equipment

$

Totals

$

Balance at 1 January 2005

540,000 28,977 45,342 57,791 40,867 712,977

Acquisitions 1,801 3,126 12,163 67,246 5,247 89,583

Transfers - - - - - -

Disposals - - - (57,791) - (57,791)

Revaluation increments/decreme-nts

- - - - - -

Balance at 31 December 2005

541,801 32,103 57,505 67,246 46,114 744,769

Cost Land & Buildings

$

Research Equipme

nt $

Office Equipmen

t $

Motor Vehicle

$

Computer Equipment

$

Totals

$

Balance at 1 January 2006

541,801 32,103 57,505 67,246 46,114 744,769

Acquisitions 4,113 3,054 8,687 - 2,223 18,077

Transfers - - - - - -

Disposals - - - - (11,208) (11,208)

Revaluation increments/decrements

- - - - - -

Balance at 31 December 2006

545,914 35,157 66,192 67,246 37,129 751,638

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RIVERINA - WINE GRAPES MARKETING BOARD 37 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

Depreciation and Impairment Losses

Land & Buildings

$

Research Equipmen

t $

Office Equipme

nt $

Motor Vehicle

$

Computer Equipment

$

Totals

$

Balance at 1 January 2005

354 21,279 34,062 6,150 22,793 84,638

Depreciation Charge for the Year

8,020 5,588 3,275 12,244 10,543 39,670

Disposals - - - (14,659) - (14,659)

Revaluation increments/decrements

- - - - - -

Balance at 31 December 2005

8,374 26,867 37,337 3,735 33,336 109,649

Depreciation and Impairment Losses

Land & Buildings

$

Research Equipmen

t $

Office Equipme

nt $

Motor Vehicle

$

Computer Equipment

$

Totals

$

Balance at 1 January 2006

8,374 26,867 37,337 3,735 33,336 109,649

Depreciation Charge for the Year

8,061 3,352 4,739 13,450 7,981 37,583

Disposals - - - - (11,019) (11,019)

Revaluation increments/decrements

- - - - - -

Balance at 31 December 2006

16,435 30,219 42,076 17,185 30,298 136,213

Carrying Amounts Land & Buildings

$

Research Equipme

nt $

Office Equipme

nt $

Motor Vehicle

$

Computer Equipment

$

Totals

$

At 1 January 2005 539,646 7,699 11,281 51,641 18,074 628,341

At 31 December 2005

533,427 5,236 20,168 63,511 12,778 635,120

At 1 January 2006 533,427 5,236 20,168 63,511 12,778 635,120

At 31 December 2006

529,479 4,938 24,116 50,061 6,831 615,425

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RIVERINA - WINE GRAPES MARKETING BOARD 38 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

NOTE 10: TRADE AND OTHER PAYABLES

31/12/05 31/12/06 $ $ 26,807 Trade Creditors 10,8346,345 PAYG Withholding 4,051

24,159 Accruals 29,12157,311 44,006

NOTE 11: EMPLOYEE BENEFITS CURRENT

31/12/05 31/12/06 $ $ 12,480 Provision for Annual Leave 17,17712,480 17,177

NON-CURRENT

31/12/05 31/12/06 $ $

8,505 Provision for Long Service Leave 10,3178,505 10,317

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RIVERINA - WINE GRAPES MARKETING BOARD 39 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

NOTE 12: CAPITAL & RESERVES RESERVES

31/12/05 31/12/06 $ $ 63,667 Asset Revaluation Reserve 63,66763,667 63,667

RETAINED EARNINGS

31/12/05 31/12/06 $ $

Retained earnings at the 1,146,411 beginning of the financial year 1,395,800

249,389 Profit for the period 157,746

Retained earnings at the end of the 1,395,800 financial year 1,553,546

Revaluation Reserve The revaluation reserve relates to land and buildings measured at fair value in accordance with Australian Accounting Standards. NOTE 13: REMITTANCES RECEIVED FROM WINERIES The Board can direct wineries to pay growers directly provided certain conditions are met. The Board’s legislation (Wine Grapes Marketing Board (Reconstitution) Act 2003) requires that all wineries make payment for purchases (not subject to complying contracts) as directed by the Board. The Board requests wineries apply to the Board for the ability to make payments directly to growers, provided all fees and charges are deducted from the growers’ payment and forwarded to the Board as per the Act. Two wineries paid through the Board this financial year. In 2006 the Board by motion returned to all leviable growers an amount of $1 per tonne. This is shown in the table below:

31/12/05 31/12/06 $ $

3,254,235 Winery/Grower Receipts 1,298,430(2,455,844) Grower Payments (355,026)

(3,556) Levies Returned (242,027)794,835 NET RECEIPTS (Levies retained) 701,377

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RIVERINA - WINE GRAPES MARKETING BOARD 40 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

NOTE 14: RECONCILIATION OF NET CASH USED IN OPERATING ACTIVITIES TO OPERATING RESULT

31/12/05 31/12/06 Inflows Inflows

(Outflows) (Outflows) $ $ 249,389 OPERATING RESULT 157,746

Adjustments for: 39,670 Depreciation 37,583 5,406 (Profit)/Loss on Sale of Assets 189

(34,939) (Increase)/Decrease in Receivables (3,777) 2,205 (Increase)/Decrease in Accrued Income (8,758)

(7,485) (Increase)/Decrease in Prepayments 13,683 (237,053) Increase/(Decrease) in Payables (13,305)

7,758 Increase/(Decrease) in Employee Entitlements 6,509 24,951 Net Cash provided by operating activities 189,870

NOTE 15: FINANCIAL INSTRUMENTS (a) Significant Accounting Policies

Financial assets and liabilities are recorded at amount due and payable. (b) Interest Rate Risk

The Wine Grapes Marketing Board’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as a result of changes in market interest rates and the effective weighted average interest rate on those financial assets and financial liabilities, is as follows:

2005 Fixed Interest Rate Effective

Interest Rate

Variable Interest

$

Less than 1 year $

1 to 5 years

$

More than 5 years $

Non-Interest Bearing

$

Total $

Financial Assets Bank Term Deposits Trade and Other Receivables

2.25% 5.51%

- -

536,399

- - -

-

300,000- -

- - - -

- - - -

- -

66,244 -

536,399 300,000 66,244

- 536,399 300,000 - - 66,244 902,643 Financial Liabilities

- - - - 57,311 57,311

Payables N/A - - - - 57,311 57,311

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RIVERINA - WINE GRAPES MARKETING BOARD 41 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

2006 Fixed Interest Rate Effective

Interest Rate

Variable Interest

$

Less than 1 year $

1 to 5 years

$

More than 5 years $

Non-Interest Bearing

$

Total $

Financial Assets Bank Term Deposits Trade and Other Receivables

5.75% 5.60%

- -

708,192

- - -

-

300,000- -

- - - -

- - - -

- -

65,096 -

708,192 300,000 65,096

- 708,192 300,000 - - 65,096 1,073,288 Financial Liabilities

- - - - 44,006 44,006

Payables N/A - - - - 44,006 44,006 (c) Credit Risk

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial instruments is the carrying amount of those assets, net of any provisions for doubtful debts, as disclosed in the balance sheet and notes to the financial statements. At balance date there were no significant exposures to credit risk. The maximum exposure to credit risk is represented by the carrying value of each financial asset in the balance sheet.

(d) Net Fair Value All Financial Assets and Liabilities are not traded on organised markets in standardised form. Net fair value is determined with reference to, and as a result is not materiality different from the carrying amounts of the assets and liabilities in the balance sheet determined in accordance with the accounting policies disclosed above. The fair values together with the carrying amounts shown in the balance sheet are as follows:

Fair Values Carrying Amount

Fair Value

Carrying Amount

Fair Value

2006 $

2006 $

2005 $

2005 $

Cash and Cash Equivalents Trade and other Receivables Other Investments Trade and other Payables

708,192 65,096 300,000 44,006

708,192 65,096 300,000 44,006

536,399 66,244 300,000 57,311

536,399 66,244 300,000 57,311

1,117,294 1,117,294 959,954 959,954 Unrecognised (losses) / gains - -

(e) Estimation of Fair Values

The following summarises the major methods and assumptions used in estimating the fair values of financial instruments reflected in the table Securities Fair value is based on quoted market values at the balance sheet without any deductions for transaction costs.

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RIVERINA - WINE GRAPES MARKETING BOARD 42 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD for the City of Griffith and the Local Government Areas of Leeton,

Carrathool and Murrumbidgee

NOTES TO AND FORMING PART OF THE ACCOUNTS for the year ended 31 December 2006

Trades and Other Receivables / Payables For receivables / payables with a remaining life of less than one year, the notional amount is deemed to reflect the fair value. All other receivables / payables are discounted to reflect fair value.

NOTE 16: COMMITMENTS There were no capital commitments as at 31 December 2006. NOTE 17: CONTINGENT LIABILITIES The Board is not aware of any contingent liabilities as at the date of signing off the accounts. NOTE 18: SEGMENT REPORTING The Board is based in Griffith, NSW. It derives its income via fees and charges on growers of winegrapes producing greater than 20 tonnes within the City of Griffith and the Local Government Areas of Leeton, Carrathool and Murrumbidgee. NOTE 19: RELATED PARTY TRANSACTIONS During the 2006 Financial Year there were no related party transactions, other than Board Fees & Allowances.

End of Audited Accounts

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RIVERINA - WINE GRAPES MARKETING BOARD 43 ANNUAL REPORT FOR 2006

WINE GRAPES MARKETING BOARD - 2007 CONSOLIDATED BUDGET 2006 Budget 2006 Actual EXPENSE ACCOUNTS Notes 2007 Budget

$ $ INCOME $ 834,600 701,377 Charges 186,400 tonne @ $3.90/t 1 726,96022,000 51,682 Interest 33,50040,000 0 Proceeds from Sale of Assets 2 48,590

103,779 16,746 Research Funds 3 39,5006,078 87,811 Other Income 30,372

1,006,457 857,616 TOTALS 878,922 OPERATING EXPENDITURE

16,500 13,636 Audit Fees – statutory 17,0007,915 11,818 Accountancy Fees 10,915

11,050 19,598 Advertising 4 28,4501,100 1,123 Bank Fees and Charges 1,400

52,000 51,317 Board Fees & Allowances 52,00011,485 6,639 Computer Expenses 5 11,6156,900 654 Conferences & Seminars 5,100

24,525 28,061 Consultancy Fees 6 99,12537,000 37,583 Depreciation 38,0005,000 455 Donations -1,050 - Employment Expenses 7 3,500

- 5,855 Employee Leave Entitlements -5,000 978 Fringe Benefits Tax 8 4,500

- 53 Doubtful Debts -14,149 11,934 Industry Functions 10,80021,024 17,095 Insurances 20,0818,650 7,836 Legal Fees 9 12,150

- 189 Loss of Sale of Assets -15,255 7,828 Motor Vehicle Operating Expense 12,6308,294 11,064 Office Expenses 12,159

11,280 10,866 Postage 11,93026,765 31,892 Printing & Stationery 29,660

870 - Promotions 250- 17,177 Provision for Annual Leave 10 13,728- 10,317 Provision for Long Service Leave 10 1,978

2,500 1,950 Rates 2,70037,500 18,280 Research Payments 20,000

- - Research Consumables 4,200218,479 213,771 Salaries & Wages 11 247,578

1,100 1,000 Sponsorship 1,00089,200 122,087 Subscriptions 12 123,3172,090 5,765 Sundries 1,200

19,663 21,581 Superannuation 23,3508,085 9,943 Telephone & Facsimile 10,725

650 396 Training 60033,505 28,623 Travel 34,005

- - Written Down Value of Assets Sold

-

698,584 727,364 SUB TOTALS 865,646 CAPITAL EXPENDITURE

250 4,113 Building Expenditure 50031,000 0 Motor Vehicle Purchases 13 71,00015,000 8,687 Office Furniture & Equipment 1,5003,500 2,223 Computer Equipment 5,5004,031 3,054 Research Equipment 4,031

53,781 18,077 SUB TOTALS 82,531752,365 745,441 TOTAL EXPENDITURE 948,177254,092 112,175 SURPLUS/(DEFICIT) 14 (69,255)

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RIVERINA - WINE GRAPES MARKETING BOARD 44 ANNUAL REPORT FOR 2006

NOTES TO THE 2007 CONSOLIDATED BUDGET The following is to explain select items of the approved budget and the advise of alterations to the Budget made by the Board. Growers have a right to question any changes to the budget as approved at the December 2006 meeting.

NOTE 1: FEES AND CHARGES The reduction in tonnes by approximately 20% has become evident and the budget should reflect the amount of tonnes that it derives its income from. The approved budget was based on 240,000 tonnes of grower’s fruit.

NOTE 2: PROCEEDS FROM SALE OF ASSET The income into this account has been adjusted from the $18,000 shown in the budget as the Board will be selling both its current motor vehicles this financial year, Ford BF Fairmont & Toyota 4WD Twin Cab. NOTE 3: RESEARCH FUNDS Research funding has been budgeted to increase from the 2006 position as the Board development staff intends to undertake regional based projects for third parties, such as colour sampling of winegrapes.

NOTE 4: ADVERTISING The cost of being the major sponsor of the Riverina Field Day $10,000 has been incorporated into the advertising account.

NOTE 5: COMPUTER EXPENSES A provision in the budget has been made for the purchase/upgrade of new computers for the office, existing equipment is greater than three years old.

NOTE 6: CONSULTANCY FEES The use of consultants may be considered by the Board for the completion of the review of its legislation. This amount is a provision and the Board will only utilise external assistance where required.

NOTE 7: EMPLOYMENT EXPENSES This expense is to account for the personal use of a motor vehicle by casual staff during vintage. The vehicle is used for the collection of grape samples for trial work that was conducted.

NOTE 8: FRING BENEFITS TAX The increase in the FBT provision is to bring it back inline with previous years. In 2006 the Board received a reimbursement for an overpayment of FBT resulting in a lesser amount being recorded.

NOTE 9: LEGAL FEES The Board estimates that it will require legal assistance during the development of submissions in regard to the review of its legislation.

NOTE 10: PROVISIONS FOR ANNUAL LEAVE AND LONG SERVICE LEAVE These provisions are for the statutory annual leave provided to full time permanent staff at the Board on a yearly basis. Long service leave is an accruals as the CEO has been employed by the Board for the past 7 years and the Board must record provisions for this liability.

NOTE 11: SALARIES & WAGES Salaries and wages have increased from the previous year as the Board will employ a replacement Technical person to work with the Industry Development Officer. The salary position decreased from the approved budget position due to the accounting of the Annual Leave Provision in the consolidated budget.

NOTE 12: SUBSCRIPTIONS The following table shows the budgeted expenditure for subscriptions in 2007.

Wine Grape Growers’ Australia $100,000 Australian Viticulture $10,000NSW Wine Industry Association $10,000 Sundries (NSW Farmers, papers, etc) $3,317

NOTE 13: MOTORVEHICLE PURCHASES Two vehicles will be purchased in line with current policy to changeover vehicles at 40,000kms.

NOTE 14: DEFICIT BALANCE The budgeted deficit of $67,571 will be funded from existing cash reserves.

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RIVERINA - WINE GRAPES MARKETING BOARD 45 ANNUAL REPORT FOR 2006

2007 ACTIVITIES APPROVED BUDGET BUDGETED EXPENDITURE

Growers are advised that many of the operating costs such as rates, electricity, general insurances, Board fees and allowances and audit fees and charges have been equitably apportioned across all of the 80 different Function – Task – Activities shown below. The total of these budgeted costs for 2006 being $144.100 ($1,801 per Task).

Industry Service Function - Task – Activity $/t

1 Participate and manage the Riverina Wine Industry Forum (RWIF). $0.03

2 Participate in the Wine Industry Relations Committee (WIRC). $0.16

3 Delivery of training programs for producers. $0.05

4 Provide comment on current contracts for growers and industry. $0.11

5 Set and enforce terms and conditions of payment for wine grapes. $0.11

6 Monitor and report on payment issues within the region. $0.02

7 Publish industry agreed standard contract provisions (annually). $0.02

8 Monitor the adoption of wine grape contracts in the region. $0.02

Development of a Code of Conduct

for contract negotiations and draft contract provisions

9 Promote MOG training module to wineries (pre Vintage) $0.02

1 Subscribe to industry publications for all constituted producers. $0.10

2 Production of regional industry newsletter (6 times per year). $0.09

3 Maintenance of a regional website for industry (ongoing) $0.03

4 Staff attendance at Regional Association meetings. $0.02

5 Maintenance of online regional wine grape sale index. $0.03

6 Attendance of NSW Wine Industry Association meetings. $0.05

7 Attendance of national industry committees. $0.14

8 Update of regional GIS database on vine plantings. $0.06

9 Liaise with SA & VIC grower representative bodies. $0.02

10 Liaise with the AWBC Information Service. $0.01

11 Subscribe to ABARE and ABS $0.01

12 Publication of the Riverina Utilisation and Pricing Survey. $0.02

13 Liaison with NSW DPI (crop forecasting and vine health issues). $0.01

14 Attendance of industry conferences and seminars. $0.06

15 Subscribe to Australian Business Limited re: industry industrial relations issues. $0.01

16 Publish cost of production information for producers in the Riverina. $0.01

17 Liaison with regulatory bodies (RTA, APVMA, EPA, AWRI, ACCC). $0.02

18 Subscribe to industry journals, newsletters and magazines. $0.01

19 Compilation and Publication of Annual Report for 2006. $0.05

Information Collection, Dissem

ination and Transfer

20 Conduct of grower meetings (budget, annual, special). $0.03

1 Production of regional pricing guides for growers. $0.02

2 Fund the development of Riverina Utilisation and Pricing Survey. $0.05

3 Publication of guide to grape picking and pruning prices. $0.01

4 Liaise with wineries regarding statutory price reporting. $0.02

Price Information

and Comm

unication with W

ineries

5 Conduct of RIVIT meetings on a regular basis. $0.02

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RIVERINA - WINE GRAPES MARKETING BOARD 46 ANNUAL REPORT FOR 2006

2007 ACTIVITIES APPROVED BUDGET BUDGETED EXPENDITURE – continued

Industry Service Function - Task – Activity $/t

1 Liaise with NSW DPI on Phylloxera freedom for the Riverina MIA $0.01

2 Conduct wine grape laboratory sampling service. $0.24

3 Liaison with NSW DPI on R&D and vine health issues. $0.02

4 Attendance at NSW WIA meetings. $0.01

5 Liaison with regional irrigation companies on water matters. $0.01

6 Maintain a regional weather station monitoring network for growers. $0.04

7 Conduct of Light Brown Apple Moth monitoring and reporting. $0.02

8 Funding of and participation in research projects in the region. $0.12

9 Development of research proposals for the region. $0.03

10 Natural Disaster Assessment of vineyards (provision). $0.02

11 Review training courses for growers in professional and technical skills $0.09

12 Development and Conduct of grower field days. $0.09

13 Research optimal wine grape maturity for harvest. $0.05

14 Liaise with winery staff to ensure optimal fruit harvest quality guidelines are met. $0.08

15 Development, delivery and management of HACCP system. $0.10

16 Production, publication and distribution of Spray Diary. $0.06

17 Provide grower viticultural advice and support. $0.07

Research, Development and Extension in Vine Health and Environm

ental m

atters

18 Conversion Trial, delivery of the outcomes to growers. $0.05

1 Distribution of a Riverina based promotional DVD. $0.02

2 Distribution of growing promotional DVD for the region. $0.03

3 Contribute to and fund Winery Trails brochure (update brochure). $0.07

4 Update of grower information in regional Visitor Centre Guide. $0.07

5 Update Tourism Touchscreens (interactive information for visitors). $0.02

6 Maintenance of wine displays (Griffith Airport & Leeton Visitors). $0.02

7 Media releases (increase Riverina inclusion within industry publications). $0.02

8 Promote branding of Riverina wine grapes processed into wines. $0.02

9 Promotion of the region at industry functions. $0.02

10 Continue to gain and aim for increased media exposure. $0.01

11 Maintenance of regional website with linkages to wineries. $0.01

Regional Promotion and increased GI labeling of Riverina wines

12 Liaison with wineries on collaborative promotional opportunities. $0.02

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RIVERINA - WINE GRAPES MARKETING BOARD 47 ANNUAL REPORT FOR 2006

2007 ACTIVITIES APPROVED BUDGET BUDGETED EXPENDITURE - continued

Industry Service Function - Task – Activity $/t

1 Liaison with the NSW Roads and Traffic Authority. $0.02

2 Develop submissions to Government (Federal, State and Local) as required. $0.02

3 NSW Irrigators Council membership. $0.02

4 Murrumbidgee Horticultural Council membership. $0.01

5 Conduct media announcements to public and growers. $0.03

6 NSW Wine Industry Association membership. $0.06

7 Wine Grape Growers' Australia membership. $0.12

8 Australian Business Limited membership and meeting attendance. $0.02

Regional Representation (Specific) of wine grape growers and industry 9 Federal Wine Grape Grower's membership. $0.25

1 Maintain Terms and Conditions of Payment. $0.07

2 Manage the payment of Board fees and charges. $0.11

3 Compliance with Statutory obligations. $0.19

4 Commence review of WGMB legislation. $0.56

5 Maintenance of current office facilities, assets and accounts. $0.63

6 Conduct and minute Board meetings. $0.06

Operational

7 Staff training provision. $0.03

Total Budgeted Expenditure1 $948,177 Gross budgeted cost per tonne2 $5.09 BUDGETED INCOME Board Fees & Charges ($3.90 per tonne on 186,400 tonnes) $726,960 Interest from Banks $33,500 Proceeds from Sale of Assets $48,590 Research Funds $60,035 Sundries $9,837 Total Budgeted Income $878,922 Gross budgeted income per tonne3 $4.72 Surplus/(Deficit) after Total Expenditure ($69,255) Budgeted Shortfall per tonne4 ($0.37) Comments: For the 2007 financial year the Board presents a revised budget based on a 23% decrease in growers’ production of 53,600 tonnes from the approved budget that was presented to growers and approved in December 2006. This has occurred due to the dryer growing conditions and frosts that prevailed across the region. The Board will be monitoring expenditure on a monthly basis to ensure that any identified savings can work to absorb the impact of the decline in production. The identified shortfall will be taken up by the use of existing reserves. . For further information pertaining to the activities budget please contact the Wine Grapes Marketing

Board. All growers are encouraged to question the expenditure of your Board.

1 Expenditure shown is the actual gross cost, it does not include income received against individual activities, functions or tasks. 2 The amount per tonne has been rounded up. Therefore the budgeted tonnes by the amount per tonne does not equate. 3 The amount $4.72 indicates the total income divided by forecast tonnes. 4 The amount shown is a shortfall to budget requirement, i.e. deficit funds.

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RIVERINA - WINE GRAPES MARKETING BOARD 48 ANNUAL REPORT FOR 2006

- NOTES -

Page 51: Text 2006 Annual Report - Parliament of NSW · Wine Grapes Marketing Board 2007 Budget 41 2007 Consolidated WGMB Budget 41 ... MYOB Mind Your Own Business – Financial Software