5,000 grape growers protest in Argentina

Some 5,000 grape growers have taken to the streets in Mendoza to protest against the government’s lack of action over a bailout for the country’s troubled wine industry.

Vineyard workers in Mendoza

As reported by Wine-Searcher.com, the protest centres around the government’s pledge this week to help finance this year’s grape harvest, due to begin in March.

President Cristina Fernandez de Kirchner signed an agreement with the wine industry this week committing to a $56m relief fund to help mop up some of the 300m liters of excess wine currently floating around the market.

During the protest, grape growers and winemakers chanted slogans and dumped wine on the steps of the city hall, leaving a petition there demanding action.

There have been calls from protesters to cancel the annual harvest festival in Mendoza, which the local government spends a large amount of money on.

A lethal cocktail of falling exports, rising inflation and a poor exchange rate is putting pressure on the country’s wine industry, particularly at entry level.

While the country has recently enjoyed growing international success with its flagship grape, Malbec, the country’s financial woes have led to a rise in costs for vineyard basics such as bottles, barrels and vine treatments.

In 2013, exports fell from a 2012 high of US$918m to $866m, with the figures for 2014 estimated to be even lower, at $823m. Argentina’s 1,300 wineries provide employment for over 400,000 people.

Wine-Searcher.com reports that grape prices have risen 10-15% over the past four years, while winemaking costs have increased by a staggering 80%.