Exploring Australia: despite the glut, wines from Down Under showcase regional flair and offer surprising variety

Cheers, Oct, 2006 by Pameladevi Govinda

Some might say the U.S. needs another critter label from Australia like Elizabeth Taylor needs another diamond. But the gimmicks keep coming as aspiring Yellow Tail wannabes and a serious wine glut in Australia brings more juice in bargain bottles under labels that scream for attention into an already overcrowded market.

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"We're going to see more Yellow Tails with the oversupply problem," predicts Alan Murray, wine director at Masa's Restaurant, an upscale establishment serving fresh Californian cuisine with a dab of French technique in San Francisco. "Australia now has wines on supermarket shelves that are cheaper than bottled water. I see the Two Buck Chuck phenomenon happening but I don't necessarily see it as a bad thing. It benefits the consumer and helps them get over this image of wine as a special occasion beverage [and see it as] more of an everyday item for the dinner table."

Deep discounted vino from the land Down Under may give consumers extra pocket change and a greater comfort level, but growers are feeling the pinch. John Griffiths, owner of Faber Vineyard and president of the Wine Industry Association of Western Australia Inc. (WIAWA), headquartered in Perth, sheds light on the glut: "I've watched the industry boom throughout the '90s when there seemed no end to the amount of vineyards we could plant and wine we could sell.

"Unfortunately, the planting got ahead of the selling somewhere about 2002. This [recent glut is] pretty disappointing. I lived through the last oversupply bust in 1986 and '87, and it was pretty similar. Basically, growers get screwed on grape prices, wineries fill up with wine they can't sell and discounting drives the retail market." Griffiths adds, "I expect we have three to five years of pain ahead."

Boutique wines that cater to niche markets are not direct victims of the glut, he notes, but as prices plummet for mass-produced wines, the image of Australian wine as a whole could be tarnished. "The prestige brands are not being subjected to the same discounting as cheaper segments. Those that have higher volumes have to compete in lower price points and I just hope they don't become victims to the discounting wars here," Griffiths laments. "It will cheapen the image of western Australia on the market. As margins are squeezed they may seek to compromise on quality to keep their cost of production low and this starts a cycle of downgrading."

BEYOND YELLOW TAIL

The image that Australian prestige wines and those priced at $15 and higher at retail would rather have is one of regional focus and distinction. The idea of an Australian appellation has been slowly evolving over the last decade but awareness in the U.S. isn't catching on fast enough. While Yellow Tail is an incredible success story, many in the Australian wine world feel the other side to Aussie wine remains largely untapped.

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"Yellow Tail did a great service to the Australian wine industry--it is the lifestyle brand that everyone wants to create," says Jan Stuebing Smyth, regional director, USA for Wine Australia, headquartered in New York City. In fact, Yellow Tail helped Australia gain even more ground on the import leader Italy in 2005; Australian wines now account for 34.9 percent of the U.S. imported table wine market, according to the Adams Wine Handbook 2006. "Now that Australian wines are so well established it's time for people to start looking at everything else Australia has to offer. For instance, wines from some of the cooler climate areas such as Orange and Margaret River."

Indeed, the behemoth brand may elicit praise for raising the profile of Australia but one does wonder whether the best selling Australian wine in the U.S. has hurt the higher end. "Yellow Tail wouldn't be selling 7.5 million cases if they weren't doing something right," says Peter Click, owner of Click Wine Group, headquartered in Seattle, Wash., "but I feel like the day before Yellow Tail exploded consumers were starting to get a little closer to the nuances of different Australian wines."

Click also voices exasperation at the lack of attention wine savvy restaurants give to Australia. "Oftentimes sommeliers will have two pages of Austrian Gruner Veltliner, which is a great wine, so I can understand that. But then you'll see five Australian wines on page 25 that are all lumped together without any regional emphasis. It boggles the mind."

SEVERAL SHIRAZ STYLES

Though the concept of regional Australian wines may be slow to hit on a large scale, anecdotal evidence suggests a growing following for cooler climate wines from designated areas. "The wines are coming from different and more specific places. Shiraz isn't just this one thing anymore; it isn't all big, juicy and jammy," asserts Andy Fortgagna, beverage director of Craft, chef Tom Colicchio's simple but quality ingredient-driven restaurant and Craftbar, its more casual sibling, in New York City. "That style is still out there and they can be delicious, but they're not the only style of Shiraz anymore. It depends on where the fruit is grown. There are recognizable differences between the Adelaide Hills and Victoria. We're now finding greater variety."