The New Year has finally arrived and most everyone I know is thankful to at least have some hope for a better year this time around. As I mentioned last time, I’m now in Australia, where Christmas and New Years on the beach seems a little strange but with a little effort I managed to enjoy it. As many of you know, I have family down under in the form of a daughter, son-in-law and two wonderful grandchildren. God, can a 10-year-old and a 12-year-old keep you hopping—cricket practice, baseball practice, net ball games and competitive swimming just to name a few of their activities. Meanwhile, their parents are very busy in the wine industry, having their own wine (Paulmara Estates “Syna Shiraz”) and Paul also is the consulting viticulturist for Penfolds and Seppeltsfield wine companies along with 36 acres of Shiraz and Cabernet Sauvignon in Barossa Valley. For the readers who haven’t made it to Australia yet, Barossa Valley is akin to our Sonoma and Napa counties, producing the best wine in Australia.
It was just a few short years ago that Australia was the big dog in the wine world, owning the United Kingdom market as well as becoming the number one wine importer to the United States. It shipped many very good wines over here and then, as production dramatically increased, it entered the lower-end market and literally took it over with the likes of Yellow Tail, Little Penquin and many other “critter labels,” all retailing from $3 to $6. As demand grew, it seemed quality went down and then—boom!—the Australian dollar went from $0.60 to the U.S. $1 to an even exchange and it lost its competitive edge. (This sure played hell with my travel budget also. In 1987, my first year there, I gave them $1 and they gave me $2. Boy was that fun. However, today, I give them $1 and I’m lucky to even get the same back—so all of that fun is gone.)
So, what does the industry look like now? I guess I could sum it up just as I did in a talk the other day about the California wine industry: It’s the shits! On the very small positive side is the increasing China market, which we’re also very interested in. It, however, is still too small and immature to make up for all of the rest of the problems. The high dollar mentioned above has completely decimated the export market and a grape glut, similar to California, hasn’t helped at all. There isn’t hope on the strong dollar front, but the Aussies have suddenly learned they need to resurrect their image as a premium quality wine producer rather than just “cheerful plonk.” There are a great number of wonderful, high-quality wines available, but Yellow Tail buried them when it was a money maker and all of the mimics followed with cheap, fun wine. The end product of this wouldn’t have been as bad if South America hadn’t suddenly come on the scene like gangbusters with good, sound wine, attractive packaging and more than competitive pricing.
Ten plus years ago, Argentine wine was awful and impossible to trust when doing business. Today, that’s all changed and they’re wonderful and trustworthy to deal with. And Chile just keeps getting bigger and better. These South American wines are also working over Australia and ourselves in the United Kingdom market as well. This following quote by an Australian winemaker could be any American winemaker as well: “The imported wines are certainly squeezing local product off retail shelves.”
To compound the Aussies’ marketing problems is the lack of competition within their own country. The entire wine sales arena is controlled by Coles and Woolworths, the nationwide supermarkets that own nearly all of the retail outlets in the country and are currently entering the private label market much like Two-Buck-Chuck and Trader Joe’s here. Another quote from another Australian winery owner is, “At entry-level prices, we’ve lost the fight to Chile and Argentina and I don’t think it will ever come back.”
Put succinctly, Australia has to return to a premium-quality image, pray that China is the market it needs, and hope for sustained growth in the domestic market of on-premise sales. Australia seems like a nation of restaurants, so that should be a sound market, but it doesn’t preclude the fact it needs to rebuild its export market. There are, just like America, a few select spots where truly premium-quality grapes can be grown and, just like here, it’s the Fresno-like areas there that are over-producing low-quality fruit. The premium areas you need to visit are Barossa Valley, Adelaide Hills, McLaren Vale, Coonawaara, Clare Valley, Yarra Valley and some of the Margaret River area. It should only take you about a month to do it well.
It wouldn’t be like me to finish without a jab at our locals: Why can’t you learn to make Shiraz? There seems to be only two kinds of Shiraz in Australia: good and better—except those from the Riverland area (think Fresno). In California, it seems like we have two also: fair and not too good. Perhaps we, as growers, haven’t learned how to raise it, or the exact right place to grow it, but are we that stupid? It’s been 15+ years that we’ve been “experimenting” and to no avail. Or, maybe our winemakers just haven’t learned how to make it. I think it can be done, since many years ago, Daryl Groom and Mick Schroeder (both from Penfolds in Australia and then Geyser Peak) made a few great Shiraz wines. But I don’t think that’s been duplicated since. Our winemakers haven’t decided if they want to be a Syrah maker (French, lighter, fruiter style) or a Shiraz (Australia, big and bold). Most California ones seem like an unsuccessful blend of both. Try some of the Penfolds Bin labeled Shiraz and see what I mean.
Well, off to the beach I go. This sunburn is beginning to feel good. My dark, olive-colored skin seems to want to look like a tomato. Maybe a few glasses of Shiraz will dull the pain! OK, off to your homework and see if you can find and enjoy some premium Australian Shiraz.
