A hormone-based spray, commonly used to kill weeds such as gorse and broom, was thought to have drifted over vineyards along State Highway 6 near Cromwell, having been applied at a nearby rural property.
Members of the Central Otago Winegrowers Association (COWA) said damage was minimal, although they warned the incident could have crippled the area's multimillion-dollar wine industry.
COWA executive committee member James Dicey said when in leaf, grapevines were particularly sensitive to hormone-based sprays, and any chemical residue could affect crops at harvest or infect the wine.
Mr Dicey said it could take vines three or four years to recover from such damage, costing the local economy millions of dollars.
Fortunately grapes, and subsequently wine, was not compromised in this instance, he said.
"It looks like we got away with minimal damage this time . . . there is no monetary loss."
Mr Dicey said grapevines were not affected by chemicals during dormancy, when they did not have green leaves, and rural property owners were "politely requested" to restrict their use of hormone-based products to between June and September.
Mr Dicey said spray had been known to drift 80km when people used wrong-sized nozzles or sprayed in the wrong atmospheric conditions.
"There has to have been a wrongful application [of spray]. It happened to another vineyard in the same area last season, but because it was a small case we decided not to do anything about it," he said.
The source of the latest chemical spray had not been detected.
If identified as having been negligent, a property owner could be made to pay for any damage, Mr Dicey said.
Abnormal leaves were first detected on a vineyard between Cromwell and Luggate in early December last year.
Subsequent inspection showed similar damage at vineyards within 7km, and analysis indicated leaves had been affected by chemical spray likely to have drifted from a property to the northeast.
COWA president Nick Mills said the incident was a "wake-up call" to landowners about the use of hormone-based spray, particularly those neighbouring organic vineyard blocks.
Central Otago's wine industry is worth an estimated $100 million to the district and provides 750 jobs.