Drink
The Drought That Saved Australia
By John Szabo, M.S.
Wartook Lake, Victoria
On a recent visit to South Eastern Australia everyone was talking about the weather. But this was no mere polite small talk. Rainfall and water in general is the most emotion-inspiring topic of conversation on the World’s driest continent, which is apparently getting drier. While this may be a controversial assessment, and is admittedly based more on speculation than solid facts, I believe that the terrible drought that has stricken Australia in the past year may well end up being the silver lining in the proverbial cloud for the Australian wine industry.
According to national weather reports and anecdotal evidence from growers across the country, Australia experienced its worst period of drought in 100 years during the 2006-2007 growing season. Add to that the misery of other meteorological disasters such as severe frosts during the spring bud burst and flower set, and the country recorded its smallest vintage since 2000, despite continual, albeit slower, increases in total vineyard plantings. With the final numbers now in, a source from Wines Australia pegs the decrease at a full 25% compared to the previous vintage. The major Murray-Darling River system is in a state of crisis, with growers reliant on its once-thought endless irrigation water supply suddenly faced with virtually zero water allocation for 2007-2008. For vineyards in desert areas that rely on irrigation to grow grapes, this is a serious blow.
The predicted lack of water is not entirely due to uncooperative clouds, however. Mismanaged water resources are a big part of the equation. According to an expert sent in by the Australian government to survey the situation along the Murray-Darling and pinpoint problems (Australia is considering to nationalize the river system, which is currently managed independently by each state through which it flows), the solutions is plain. 85% of domestic water use is metered and paid, while only 15% of agricultural water use is paid for by growers. It has been pretty much a free for all: no cost, no controls. Alarmingly enough, Australia ranks 3rd in the world in water use per capita behind the USA and we Canadians, but hey, we’ve got lots), a luxury of use this near desertic country can ill afford.
So what does all of this mean for the Australian wine industry? Despite the fact that grape crops rank higher on the water usage vs. value scale, ahead of more thirsty, less valuable crops like rice and cotton, the shear lack of water in these desert conditions means that the major source of inexpensive grapes for generic "South Eastern Australia" multi regional blends could well be about to dry up, literally. This thought seems all the more ironic given the horrendous flooding in the Hunter Valley at the beginning of June (some vineyards were washed under 5 feet of water), but the danger is real.
But is this such a bad thing? Until this last vintage. Australia was in the midst of a well-publicized wine glut, marked by oversupply of grapes and falling prices. The market conditions over the last several years were thus ideal for the development of multi-regional, value brands, no better exemplified than by the Yellow Tail phenomenon, which soaked up a good part of the oversupply and allowed Australia to penetrate more deeply into markets around the world. This fit in nicely with the industry’s "Strategy 2025" marketing plan, published in 1996, whose sales targets were met in early 2005, 20 years ahead of schedule.
One possible outcome of the water shortage is that vineyards that should have never been planted in the first place will disappear. The heavily irrigated areas of the Riverina, the MIA and other industrial production zones will have to seriously evaluate the viability of viticulture in the medium to long term. As a major source of grapes for many of the large, branded offerings, fruit shortage and/or grape prices could stretch wine prices out of the "value" category, and many of the upstart labels may perish. On the other hand, vineyards situated in zones more naturally suited to viticulture and capable of producing wines of diverse style and high class will continue to flourish and lead the way toward distinctive, quality wine production.
This is all positive, as the generic image of "Brand Australia", the basis of past success and the major battle cry of marketers down under until recently, has become the obstacle in further market development in many countries across the world. The impression that Australia excels only at consistent, plump, juicy, in-your-face fruity value wines has severely limited their penetration into the serious on-trade market, at least in Canada. Increasingly, sommeliers are looking for distinctive wines, those with a marked regional identity, which they can use to offer their customers a unique and "value-added" experience, not generic, homogenous, interchangeable brands.
The thing is, Australia produces plenty of unique wines, It is just buyers’ impressions that must be changed. Addressing the situation, Wines Australia has unveiled it new strategy, called "Directions 2025". In this clever new plan, wines are broken down into 4 categories, each aimed at a different market segment: "Brand Champions" encompasses the big branded wines; "Generation Next" wines are characterized by innovation both inside and outside the bottle (I tasted some strange stuff down under from obscure and unexpected varieties like Aglianico, Sagrantino, and Verduzzo); "Regional Heroes" is a major new thrust of the industry, focusing on region-specific, distinctive wines; and "Landmark Australia" represents the icon wines such as Penfold’s Grange, Eileen Hardy Chardonnay and the Artist Series from Leeuwin Estate in Margaret River.
The purpose of my visit was to focus on the "regional heroes". To paraphrase Mark Twain, there is nothing like travel to kill prejudice, in this case, the widespread impression that Australia is all about multi-region homogeneity. A short list of decidedly non-mass market driven, regionally distinct wines would have to include the stunning Semillons of the Hunter Valley, austere, mineral and lime cordial-scented Rieslings of the Clare and Eden Valleys, cool and elegant Chardonnay and brisk Sauvignon blanc from the Adelaide Hills, the Pinot Noirs and peppery "Syrahs" of Victoria in general and the Mornington Peninsula and Yarra Valley in particular, sparkling wine from Tasmania, the liqueur wines of Rutherglen, and of course the Cabernets of Coonawarra and Margaret River and the Shirazes of the Barossa and McLaren Vale.
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