Australian wine: the way forward
“What’s the difference between an English wine merchant and a terrorist?” says Australian Vintage’s award-winning winemaker, Peter Hall. “You can negotiate with a terrorist.”
British buyers have long fought for low prices on Australian wine and a number of producers Down Under have in turn enjoyed enormous volume growth. It remains by far the largest country of origin on UK shelves, the size of France and Spain combined, and it has returned to growth over the summer, but the average price point still stands at just £5.23 (Nielsen, year to July 2017).
That is unsustainable for retailers and producers alike in the wake of duty increases and exchange rate pressures, so Wine Australia is on a mission to educate the British public about the country’s ability to compete at higher price points, its regional diversity and its willingness to challenge the sunshine-in-a-glass stereotype with wines that are elegant and complex yet still offer great value for money.
The King Valley is one of the less heralded regions Down Under but it is one of the most unique. It was settled by Italian immigrants and retains a huge Italian influence: the people look Italian, wear Italian designer labels, cook Italian food and grow Italian grapes. You could easily be forgiven for thinking you are in Italy, until one opens his mouth and says: “A wallaby got under a wombat hole and ripped through my vineyard.” Apart from perhaps the Adelaide Hills – which is a smorgasbord of different styles, varietals and characters – each region has pretty much established what it is best at and presents a clear and simple message to the world: the Hunter has Semillon and Shiraz, the King Valley has its Italian varietals, the Yarra has Chardonnay and Pinot, Barossa has Shiraz and Chardonnay, McLaren Vale is showing everyone how stunning Grenache can be, Coonawarra has Cabernet, Tasmania is producing superb Pinot and sparkling wine, and so on.
There is still experimentation and dynamism, but the different regions’ leading lights are all pulling in the same direction and working collegiately to increase the general quality of the wine and the clarity of their marketing messages.
Even high volume companies like Australian Vintage are at it. It does not simply produce high-volume, fruit-forward, cheap and cheerful wines, as Hall keeps winning medals and trophies for his exquisite Hunter Valley Semillons, and the same critical success is apparent for high-end offerings from the likes of Treasury Wine Estates and Accolade. Across the board Australian wines are becoming more restrained and less reliant on oak or overblown, jammy flavours as winemakers discover the confidence to let the fruit shine through in an elegant and complex fashion.
THE BREXIT CHALLENGE
Brexit is a concern for many indies as the subsequent hit to exchange rates has rendered many interesting wines unsuitable for them commercially. “I am frustrated that thanks to the idiots that voted for Brexit we are less able to afford these wonderful wines than we were 18 months ago,” says Simon Taylor, owner of Stone, Vine & Sun in Winchester. “However, there isn’t a large differential between people making very ordinary wines and very good wines, so if you work hard enough there are lots of super wines that will work very well in the UK market.”
“Australia is becoming more relevant. It’s a very competitive space that Australian wines occupy and with a very traditional business like ours with a leaning towards European wines it has to earn its keep, and I see no reason why it shouldn’t.”
OBCURE GRAPES START TO FLY
A term you will hear bandied about a lot in Australia is “emerging varieties”, which refers to pretty much anything that is not French in origin. The nation’s pioneering spirit is embodied by the huge wealth of different grapes that winemakers are experimenting with, from Assyrtiko to Durif, and there has been great growth in some of the lesser-heralded grapes, albeit from a small base. Australian Touriga Nacional, for example, is up 575% in the UK, Sangiovese has grown 396%, Fiano has climbed 273% and Vermentino is up 185%, according to Wine Australia.
Each region has pretty much nailed down which main varieties it is good at, and has devoted the majority of the land under vine to them, but there are other grapes that are being given a lot of attention by some of the younger winemakers.
Simon Taylor, of Winchester-based Stone, Vine & Sun, gets straight to the point with his assessment of the movement.
“I was not loving the alternative varietals, because I sell Vermentino from the Languedoc for £8.99 that is much better than what I was offered in Australia,” he says.
“Ditto some of the other emerging varietals. However, there is a clear future for red Italian varietals in Australia, in particular Nebbiolo. In the cooler regions Nebbiolo fits beautifully and will work very well alongside Pinot Noir as a top quality Australian varietal of the future. I think Tempranillo is a dead end, in the sense that it is just simple strawberry fruit.
“What won’t work well in the UK market is very ordinary examples of, say, Fiano or Gruner Veltliner, that might work for buyers in Sydney and Melbourne but aren’t suitable for the UK market at those price points.
“Its strengths are high-quality Pinot Noir, Chardonnay and Shiraz, and the wines, particularly in the Yarra and the Adelaide Hills and the Grenache in the McLaren Vale, are Australia’s assets and our customers will respond to them very well.”
Other buyers echo Taylor’s appreciation of the Nebbiolo and Sangiovese being produced Down Under, but admit they are a difficult sell to UK wine drinkers. Freddy Bulmer, buyer at The Wine Society, says: “It’s difficult to get the consumer to understand why they should buy Sangiovese or Vermentino from Australia – Italian varieties that aren’t as established in Australia as Chardonnay and Pinot Noir are – rather than Italy, where you can get that sort of thing for £9 instead of £29. There is a way to go. But some of the Sangiovese we tasted – from Pizzini, for example – was absolutely stunning. A £35 Sangiovese from them is genuinely world class, and the tannins are different to a Chianti, giving it a nice point of difference.”
Ruth Yates, owner of Corks Out in Cheshire, is extremely positive about the appeal of less well known varietals coming out of Australia. “We have seriously seen a lot of interest there,” she says. “We find it a real struggle to sell Touriga Nacional from Portugal, but we’ve not had an issue selling it from Australia. It’s the same with Fiano and Vermentino from Italy, and Tempranillo from Spain. Consumers see Rioja and Chianti as brands, but do they really understand Tempranillo or Sangiovese? When they are looking to buy those grape varieties they are not sure about them, but they are comfortable with Australia and get a massive amount of reassurance from that, and we have been selling more and more of the Australian varietals because of that. They are willing to experiment a bit more.”
Simon Thorpe, managing director of Negociants UK, points to Jim Barry’s Assyrtiko or Chaffey Bros Dufte Punkt, a blend of Riesling, Gewurztraminer and Kerner, as strong examples of innovation coming out of Australia. “Innovation could be in new varietals or emerging regions, or in winemaking excellence, or the fact that all wines under the Yalumba brand are now vegan and vegetarian friendly,” he says. “Australia has for many years been at the forefront of quality wines at large volume, but this is now joined by quality and diversity across many producers and regions.
“It’s easy to point to new varietals or regions growing in importance, but actually I think there is real interest to be found in the advancements and creativity in the established players in the market.
“For example there has been a revolution in styles of wines from an established region such as the Barossa – a transition to more elegant wines with no loss of a sense of place.
“You could easily argue the same for Margaret River, McLaren Vale or Clare Valley. I’d urge anyone who hasn’t tasted broadly across the Australian wine category recently to dive in with no prejudice and an open mind and see what they discover.”
NEW WORLD RIVALRIES
South African Master of Wine Greg Sherwood, buyer for London indie Handford Wines, believes it is difficult for Australia to compete with his homeland because it lacks the diversity and unique selling points South Africa boasts.
But John Chapman at the Oxford Wine Company says: “It is on the same page as South Africa and the message is easier because the tradition of importing into the UK leaves a stronger basis to build on and they can extrapolate from the classic Barossa Shiraz or the refined Mornington Pinot. With South Africa it’s all a bit Wild West. In Australia they have all that funky new age stuff but it’s built on a foundation of quality.”
Loki’s Phil Innes adds: “South Africa for me still offers the best value for money out of all the countries, but Australia still gives you a really good bang for your buck, because there is high quality and great value across the board. They are not necessarily the cheapest any more, but that doesn’t mean people aren’t getting good value. They are just paying for a really great, well-made product.”
"Australia remains the biggest wine country of origin in the UK, with Jacob’s Creek showing strong growth, up 17.4%. The value growth in Australia is being driven by the increase of super premium wines, as consumers look to drink less but higher quality wines. In order to maintain the recent growth there is a real need to continue to innovate with new products such as our recently launched Jacob’s Creek Le Petit Rosé, to drive further interest and attract a younger shopper to the category. We think there is an opportunity for independent operators to attract new drinkers and add excitement back into the category with innovative launches such as Jacob’s Creek Le Petit Rosé and Double Barrel Matured. Although the Australian category has experienced decline, there is growth in the premium end of the category. On top of that, we believe that more can be done to engage shoppers within the last 3ft of the wine fixture. Showcasing the quality of wines that Australia offers will help get shoppers to experience the journey, starting with in-store engagement as a first point of action. In addition, offering responsible sampling opportunities in-store will help drive basket spend and we find that it is an effective method to engage consumers and provide them with the confidence to try something new.”
Vicky Hoey, head of marketing at Jacob’s Creek
"Across the board the Australian industry seeks continual improvements, whether that be in understanding the interaction of terroirs and grapes, clonal selections or embracing the most modern philosophy in winemaking. The past is being used to inform future planning – it’s exciting. There is innovation both in new, boutique wineries and in the larger more established operations. That could be in new varietals or emerging regions, or in winemaking excellence. Good and recognisable brands are doing an excellent job. It’s reassuring for the slightly less engaged consumer to know that a bottle of Oxford Landing Sauvignon Blanc delivers consistent value for money across all channels. [But] Australia, without ignoring its core capability, definitely needs to sell more wine above £8 into both on and off trade. [Growing sales] is mainly a question of continuing to focus on those things that deliver a great proposition to the consumer: namely good wine at good prices with an interesting, authentic and engaging story.”
Simon Thorpe MW, managing director, Negociants UK
Which regions impress the wine buyers?
“The Yarra is commercially very viable for finding good quality wines.”
John Chapman, Oxford Wine Company
“Yarra and Adelaide Hills are areas we need to look at. In the Yarra there are people making a much fuller and more voluptuous Pinot, and some making a lighter Pinot.”
Matt Hennings, Hennings Wine
“King Valley was somewhere I had no expectations of and I was really taken aback by the quality they have. What they are getting from vines of four years of age, some even younger, just shows they have a really bright future. I am really impressed with the Yarra. I love the pioneering spirit there. It is Pinot Noir and Chardonnay, which some people are bored with, but they have a really distinct message about what they do, and they do it really well and in a really great style. You have the old established guys doing things really well, but the exciting thing for me are the younger ones throwing out the traditional way of doing things, like Mac Forbes and Timo Mayer; they were really good. Barossa has a slightly confusing message, but I was really impressed with the Eden Valley Barossa wines. They had a real freshness about them.”
Phil Innes, Loki
“Yarra is a real eye opener. There are some really good, innovative winemakers coming through that are not afraid to do their own thing. They are experimenting and that’s the way it should be. The Australians are more innovative now than they have ever been, and I put that down to new winemakers coming on board. There’s a lot going for Australia, especially regions like King Valley and Canberra, that have a cooler climate. Canberra is really great for Riesling.”
Ruth Yates, Corks Out
“Yarra is really, really interesting. The Chardonnays and Pinots are a really nice expression of the region. Canberra is an interesting region. They have the conditions, but will take a couple more generations to get established.”
Freddy Bulmer, The Wine Society
"The places with the best identities are Yarra and the Adelaide Hills, where they are focused. Strathbogie has huge potential. I am sure in the next 20 years we will see some really good wines from there.”
Stewart Travers, Cambridge Wine Merchants