{"id":540174,"date":"2026-04-19T23:59:15","date_gmt":"2026-04-19T23:59:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/540174\/"},"modified":"2026-04-19T23:59:15","modified_gmt":"2026-04-19T23:59:15","slug":"falling-consumption-rising-costs-and-tariffs-take-bounce-out-of-yellow-tail-winemaker","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/540174\/","title":{"rendered":"Falling consumption, rising costs and tariffs take bounce out of yellow tail winemaker"},"content":{"rendered":"

Thanks to an American 2017 Super Bowl advertisement, the line “Wanna pet my roo?” came to represent one of Australia’s best-known wines, but now its maker is one of a growing number of wine businesses seeing a dramatic slump in profits.<\/p>\n

Yellow tail winemaker Casella Wines Pty Ltd recorded a $5.5 million loss last financial year \u2014 a big drop from profits of $18.6 million in 2024 and $26.5 million in 2023.<\/p>\n

Managing director of the family-owned company John Casella said it reflected the pressures facing the wider wine and drinks industry.<\/p>\n

“We’ve seen rising input costs across the supply chain, including raw materials, energy and freight, alongside higher interest rates, foreign exchange volatility, and the impact of US tariffs, all of which have weighed on margins,” he said.<\/p>\n

\"A<\/p>\n

John Casellla says the company has a strong balance sheet. (ABC Riverina: Emily Doak)<\/p>\n

It is 25 years since yellow tail wine entered the US market, quickly becoming the poster child for Australian wine overseas.<\/p>\n

But Mr Casella said the US market had been a challenge in the past year, with 10 per cent tariffs and a fall in consumption of imported wine.<\/p>\n

“This softness has been offset by growth across other key regions, including the UK, Europe, Asia, Canada and Australia, resulting in increased overall sales across our major markets,” he said.<\/p>\n

\"an<\/p>\n

Casella Wines buys half the wine grapes produced in the Riverina. (Landline)<\/p>\n

Financial reports lodged with the Australian Securities and Investments Commission (ASIC) show Casella Wines, worth over $1 billion, has also increased its debt by $170 million.<\/p>\n

It also notes the company was in breach of the fixed charges cover ratio in its debt covenant at June 30 but received a waiver from its bank in November.<\/p>\n

Mr Casella said the business had a strong balance sheet and was well-positioned to navigate current conditions.<\/p>\n

“Our message to grape suppliers and employees is that the business is financially stable, and we remain confident in our future,” he said.<\/p>\n

Vine pull accelerates in the Riverina<\/p>\n

Casella buys almost half the wine grapes grown in the Murrumbidgee Irrigation Area (MIA) in southern New South Wales.<\/p>\n

Riverina Winegrape Growers chief executive Jeremy Cass said the company’s financial results came as no surprise in what was a difficult time for the whole sector.<\/p>\n

\"A<\/p>\n

Jeremy Cass expects more grapevines will be removed. (ABC News: Emily Doak)<\/p>\n

“It’s devastating to see those sorts of figures come out because it just means that this is going to be pushed further down the line [to growers],” he said.<\/p>\n

The MIA has been hit hard by the downturn in the wine industry<\/a>, with large areas of grapes taken out of production after years of prices below the cost of production.<\/p>\n

Mr Cass said in the past four years, 75 of the region’s 275 growers had left the industry, while others had reduced the size of their vineyards.<\/p>\n

“There were about 22,000 hectares in the ground. We’re now down to about 16,000 hectares, and that’s not including what’s already started to come out this year,” he said.<\/p>\n

\"a<\/p>\n

Bruno Altin is removing 20 per cent of his vineyard. (ABC News: Emily Doak)<\/p>\n

Nericon grower Bruno Altin did not make any money on his wine grapes this year and is removing 24 hectares of his 124-hectare vineyard.<\/p>\n

“I don’t see a future in growing wine grapes, especially not in this region,” he said.<\/p>\n

\"A<\/p>\n

Bruno Altin says prices have been below the cost of production. (ABC News: Emily Doak)<\/p>\n

The 26-year-old vines lying dead on the ground were planted when he was a teenager.<\/p>\n

“It’s mixed emotions because I’d come home from school with my brother and we’d train vines and fix the vineyard up,” he said.<\/p>\n

“Also, relief because the decision’s made and we can move on.”<\/p>\n

\"A<\/p>\n

The vines will be burnt. (ABC News: Emily Doak)<\/p>\n

Another of the MIA’s large family-owned wineries, De Bortoli Wines, is also navigating the challenges of the 2-billion-litre wine glut.<\/p>\n

Managing director Darren De Bortoli said his business was looking at restructuring and keeping costs under control.<\/p>\n

“Basically being \u2026 a smaller wine business in reaction to the current market conditions,” he said.<\/p>\n

\"A<\/p>\n

Darren De Bortoli describes the downturn as particularly nasty. (ABC News: Emily Doak)<\/p>\n

Industry asks for help to restructure<\/p>\n

Grape and Wine Australia, which represents both winemakers and growers, has put a pre-budget wish list to the federal government.<\/p>\n

It calls for almost $140 million over three years to address structural oversupply, rebuild demand and support growers and winemakers.<\/p>\n

Proposals include grants to support growers transitioning to other industries, concessional loans, and designing a mechanism to get rid of unsaleable red wine.<\/p>\n

\"A<\/p>\n

Bruno Altin is trying to cut costs in removing his unprofitable vines. (ABC News: Emily Doak)<\/p>\n

Rather than handouts, grape grower Bruno Altin wants tax incentives.<\/p>\n

“If you remove 50 acres of grapes and you plant almonds, just for argument’s sake, maybe the first five years’ worth of crop you don’t pay tax,” he said.<\/p>\n","protected":false},"excerpt":{"rendered":"Thanks to an American 2017 Super Bowl advertisement, the line “Wanna pet my roo?” came to represent one…\n","protected":false},"author":2,"featured_media":540175,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,186266,186267,1294,186271,56,54,55,186268,27757,186269,186270,186265],"class_list":{"0":"post-540174","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-casella","10":"tag-de-bortoli","11":"tag-economy","12":"tag-grape-growers","13":"tag-uk","14":"tag-united-kingdom","15":"tag-unitedkingdom","16":"tag-vineyard","17":"tag-wine","18":"tag-wine-glut","19":"tag-wine-grapes","20":"tag-yellow-tail"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/540174","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=540174"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/540174\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/540175"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=540174"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=540174"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=540174"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}