Fires and virus: how wine makers are making the most of COVID-19

What followed was set to cause economic heartache for Victorian growers, particularly in the state's east where bushfires had been fiercely burning, smoke tainting some vineyards beyond recovery in another harsh financial blow.

As tourism had all but dried up due to the bushfires, regional hospitality was brought to a standstill almost completely halting two major sectors wine producers depend on.

While the vintage and wine making has remained largely unaffected during the pandemic, primary producers like Matt Fowles, Fowles Wines, Avenel, have stood down staff as businesses come to terms with the economic fallout.

Mr Fowles and his wife Luise have run the 121-hectare vineyard since October 2005 and produce 1.2 million bottles of red and white wine annually across 12 varieties.

While Fowles Wine was not affected by the recent bushfires, major export orders to places like China are only starting to return two months after the country entered lockdown.

The pandemic forced the pair to shut their multi-million dollar 250-seat restaurant and cellar door, putting staff out of jobs temporarily as the business was unable to operate due to COVID-19 restrictions.

As the company experiences a downfall in revenue due to such closures, consumers are looking for alternate ways to get their hands of sweet or subtle white or decadent and delicious red.

Based on volume of sales, Fowles Wine has increased online wine sales by more than 100 per cent in the last two months and while it doesn't cover the cost of revenue lost through the closed restaurant, it is helping.

"We sell to hospitality and tourism businesses and they're the industries which are most suddenly affected so that the wholesale stream of our business has been greatly impacted," Mr Fowles said.

But like most bad events, it can bring out some positive change and the silver lining for the wine industry has been an increase in online wine purchases.

"People are buying online because of the restrictions and many wineries are offering free shipping due to social distancing," Mr Fowles said.

"We're not sure if it's the fact that we're offering free shipping or the fact that they're sitting at home and can't go out that's driving consumer demand but we have noticed a significant increase of online purchases."

The company employs 45 full-time equivalent staff, many which have been displaced since the virus hit Australian shores, however, Mr Fowles said it was in the process of applying for the federal government's JobKeeper package in an attempt to keep his staff employed.

As export orders for wine to China begin to pick up, Mr Fowles said the frequency of export orders was mostly unchanged, however, volume had lessened as people were buying conservatively.

"We still don't know how consumers will respond to this overall but I feel in Australia we will have a solid recovery in hospitality," Mr Fowles said.

"Even when people are feeling down they want to feel special and it's like the lipstick effect; if you can't afford a holiday or a luxury car, people want to have a moment of pause and feel beautiful and whether it's lipstick or wine or a meal, people will want to be together and break bread rather than make discretionary spends."

Wine Victoria chair Angie Bradbury said coronavirus had affected the wine industry enormously on the back of the December/January bushfires, drought and challenging weather conditions which meant the industry was already facing a difficult vintage for 2020.

"We've had a triple impact so it's been quite debilitating," Ms Bradbury said.

The group represents Victoria's 21 wine regions and is the key liaison between industry and government.

"It started in January when China's economy got shutdown and a dramatic handbrake was put on exports, then around the same time we had regional tourism come to a grinding halt due to bushfires. Just when it looked like there was some recovery in regional tourism, we had the shutdown and self isolation measures which brought the industry to a halt," Ms Bradbury said.

Ms Bradbury said industry had reported revenue declines of up to 80 per cent in the first quarter of 2020.

"There's been a significant increase in retail demand both in traditional sales in store but also online - quite a few wineries have seen some increased traffic to their websites," she said.

"However, that's not enough to mitigate the declines in other parts of their businesses so the best thing anyone can do to help the industry is to go to a bottle shop or online and buy from a Victorian winemaker."

In East Gippsland, Lightfoot & Sons Wines was forced to close its cellar door due to the December/January bushfires, but managed to experience a "resurgence" from late January onwards, general manager Rob Lightfoot said.

However, since the pandemic has forced the closure of pubs and restaurants about 80pc of the business' revenue has gone.

The 27-hectare winery is situated at Bairnsdale and grows grapes mainly for its Pinot Noir, Shiraz and Chardonnay labels.

"Unlike in the bushfires where sales were really slow because no one was around, now every hospitality business is shut and our sales have slowed right down," Mr Lightfoot said.

Since December, the Australian Wine Research Institute has undertaken 3700 smoke taint tests on grapes across Australia, 50 per cent of those tests on Victorian vineyards.

"We've seen quite staggering results from across the board in different regions but at the same time the encouraging thing was that some areas we thought were heavily affected, actually indicated quite low smoke taint exposure," AWRI managing director Mark Krstic said.

He said it would take some time for the full effects of the fires to be realised given the big scale of blazes not only in Victoria and also interstate.

Have you signed up to Stock & Land's daily newsletter and breaking news emails? You can register below and make sure you are up to date with everything that's important to Victorian agriculture.