Murray Valley Winegrowers has suggested that Foster's Group look to sell two of its vineyards in the region to the Australian government.

Last month, Foster's announced that it plans to sell off 36 "non-core" vineyards in Australia, following the completion of a global review of its wine operations.

Properties near Pomona in south-west New South Wales and Cullulleraine in north-west Victoria, which occupy at least 600 hectares and are thought to have water entitlements of more than 50,000 hectolitres, are included in the proposed sale.

The trade body, which represents around 1,300 winegrape growers in the Murray Valley region, said yesterday (25 March) that such a sale would help reduce the current over-supply situation, as well as ease the burden of water shortages in the country.

"Selling the vineyards to the Federal Government as part of its water buyback programme would help reduce the over-supply of wines grapes, particularly Chardonnay, and relieve pressure on the overused Murray-Darling river system," said Mike Stone, CEO of Murray Valley Winegrowers (MVW).

"There's precedence for such action," Stone continued. "Last year, the Australian government purchased Toorale Station in NSW for A$23.8m.

The chairman of the Foster's Growers Liaison Committee in Murray Valley, Dennis Mills, added that many independent winegrape growers are expected to apply for the Australian government's 'Small Block Irrigators Exit Grant', a condition of which is the sale of permanent water rights to the Government and destruction of irrigation infrastructure.

"The majority of the growers who do this have little choice," Mills said. "Years of declining grape prices and cuts in water allocations have made their situation untenable, and action by Foster's to also cut grape production and water use would be applauded as responsible and appropriate."

No-one was immediately available for comment at Foster's when contacted by just-drinks today.