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Dan's Blog

International Trends - Doom & Gloom?

Friday, April 26, 2019

Recent international media reports about wine and wine sales are mainly negative, with some being positively dark and negative. Here are a few that I found interesting.

USA:  In the twelve months to the end of March, USA total exports of wine fell by 12%. Whilst the 35% of US wine that goes to Canada remained pretty much constant, the overall export sales declined.

While not spelt out in the statistics currently available, it would seem that the main region where the sales have dropped is Asia and in particular, China.

Interestingly, their sales of bulk wine over the same period went up (co-incidentally) by 12% so that total bottled wine sales fell by more than 12% in total. Fifty-six percent of their bulk wine exports are to the UK, where the wine is then bottled for sale across Europe. As yet, the impact that Brexit will have on this is unclear. Will they continue to bottle in the UK or is there value for them to move their bottling operations to Europe?

FRANCE:  BEAUJOLAIS – Climate change has led to Beaujolais having hotter and dryer summers, as well as more hail storms, to the extent that the cost of organically grown grapes has doubled over the last five years. Producers there are beginning to feel that if they have another two to three hot, dry summers they may well end up being priced out of the market. Especially as Beaujolais is considered an “every day” wine rather than a premium, special occasion product like Bordeaux or Burgundy, which can weather price increases.

CHAMPAGNE – Shipments of Champagne to Britain, in 2018, fell by 1,000,000 bottles, in what the Champagnois are calling a “rebalancing” of the market. But what they don’t say is that in 2017 the same market dropped by almost 4,000,000 bottles. So whilst they still sold 26.8 million bottles in 2018, these losses of sales of 5,000,000 bottles over 3 years have to be hurting, especially with the spectre of Brexit looming. This could mean higher costs for the Poms and therefore yet again, lower sales of champagne.

Australian imports of Champagne fell for the first time in 2018, after ten years of significantly increasing sales. With 8.4 million bottles being imported, Australia is currently the sixth largest Champagne market.

UK:  A recent report by IWSR shows that during 2016-2017 the UK drank three million less cases (dozens) of wine than in the previous year!! That is 2% of the 114 million cases they drank, but it is still a decline and it is expected to continue as Brexit comes into effect and people become more austere as a result. The only section of the wine industry to buck this trend was sparkling wine which had an increase of nearly 600,000 cases (making the champagne figures even sadder). This rise was predominantly in Prosecco and British sparkling wine.

On the other more positive side of the coin –

UK:  It has just been announced that sales of UK made wine have risen by 186% in the last 12 months as more consumers embrace British wine.

AUSTRALIA:  Australian wine sales to China continue to grow despite the fact that China’s wine imports have flattened out. Our exports to China now exceed 50% of value of what the French sell to China and rising. In 2003 this figure was 8% of the French sales. C’mon Aussie, c’mon, c’mon!!!

At the same time Chinese businesses continue to seek investment in the Australian wine industry. The largest investment so far is that of the Weilong Winery in Sunraysia (near Mildura), which reportedly has the capacity to crush up to 170,000 tonnes of grapes, with all of the wine made, being exported to China.

Meanwhile, despite a slight increase in politically inspired obstacles, more and more, small to medium Australian wineries are making inroads into the China wine market. Outstanding!!

Well I hope you have a great and successful week and enjoy plenty of great Aussie wine – Cheers!

THIS WEEK’S WINE REVIEW:

This week I am talking about GRENACHE, the variety that is loved/hated by Aussie wine drinkers.

Way back when Australia was shifting away from fortified wines to table wines, Grenache was one of the unsung heroes. However, somewhere along the line it fell out of favour and many, many acres of magnificent old vine Grenache were ripped out during the infamous “Vine Pull” Scheme of the mid-1980s.

Thankfully a few stalwarts hung on to their old vines and we have been rewarded ever since by some sensational Grenache wines.

Unfortunately just recently, some winemakers have been making “new style” Grenache which they pick early for lower alcohol (usually below 14%), but alas with much lower flavour. Most of the ones I have tried have been thin, green and pissy – Abhorrent!  It is all part of this obsession with lower alcohol. I drink wine for the flavour not the level of alcohol and some varieties such as Grenache need to be fully ripe (higher alcohol) to give us their best. Hey, if this means I have to drink 0.3879 of a glass less for the alcohol police, so be it – because all I want is them there yummy flavours!

Luckily for us, or me at least, there are still some people making glorious, big, rich Grenache wines. One of the leaders in this brigade is d’ARENBERG WINES, who have been making superb Grenache wines under various labels since when d’Arry was a boy. My best mate tells me that his favourite wine in the late 1960s when he moved down to Adelaide from Sydney was, d’Arenberg’s Red Stripe Claret (in flagons in those days), which was predominantly Grenache.

Finally off my soap box and down to this week’s wine –

d’ARENBERG 2016 “THE DERELICT VINEYARD” GRENACHE: Oh, WOW! What a smashing wine! This is Grenache at its very best! Delightful, rich, slightly spicy aromas with oodles of unctuous, superb flavours leading to an excellent, beautifully balanced finish that lingers for eons.


Still quite tightly wound up, it just needs more time to relax, evolve and display its real magic. Rummaging around my cellar I found a bottle of the 2014 vintage which with the extra two years has just started to bloom fully and show what an extraordinary wine it is becoming. www.darenberg.com.au

Thanks Chester, d’Arry and crew, because for me, this is the Grenache benchmark!