A Glass Half Full
Before embarking on the slings and arrows of outrageous fortune that have fallen on Australia’s winemakers over the past 12 months, let me reassure you that the 1055 wines submitted for this year’s Top 100 were extremely good.
By James Halliday
As featured in
Before embarking on the slings and arrows of outrageous fortune that have fallen on Australia’s winemakers over the past 12 months, let me reassure you that the 1055 wines submitted for this year’s Top 100 were extremely good. If there was one issue that impacted every region in every state in the 2020 vintage, it was low yields. First drought then adverse windy and wet weather during flowering reduced berry and bunch sizes. The three inland irrigation regions (Riverland, Murray Darling and Riverina) that contributed 79 per cent of the total crush were only four per cent down on the 2019 crush, whereas the remaining 59 regions decreased by 34 per cent.
Bushfires and smoke taint were the next issue, with NSW bearing the greatest losses. The Hunter Valley, Mudgee, Orange, Canberra District, Southern Highlands and Tumbarumba made no red wine due to smoke taint, Tumbarumba also suffering destruction of vineyards by fire. In South Australia, 45 per cent of Kangaroo Island was affected, and parts of the Adelaide Hills suffered smoke and outright destruction of vineyards. In Victoria, smoke and fire visited Beechworth and Rutherglen, but for the rest of the state, drought and poor fruit set were enduring problems. Western Australia and Tasmania avoided fire, but not drought.
Throughout this saga, winemakers had a curate’s egg: good in parts. The “parts” were the quality of the grapes and the resulting wine. Harvest proceeded without undue challenges from heat or rain. Australia’s wine industry had entered a period of prosperity, with 62 per cent of its production exported, the lion’s share to China. The value of our exports for the 12 months to September 30 this year increased by four per cent to $2.998bn, the highest level since 2007. After declining in the first six months of 2020, exports rebounded strongly in the September quarter. In this year of surprises the greatest increase was the UK, up 18 per cent to $430m, followed by New Zealand, up nine per cent to $103m, then mainland China ($1.2bn) and Canada ($196m), each up four per cent. However, the optimism was short-lived.
China is far and away our largest and most profitable market, larger than the combined total of exports to the US, UK and Canada. If the market were to disappear overnight, as seems likely at the time of going to print, it would be little short of a disaster. Treasury Wine Estates is first in the firing line, but many of our small to medium-sized wineries have built up significant exports to China and will also be hurt by trade bans. The UK, too, is wracked by Covid-19 and Brexit issues, causing trade uncertainties with no obvious solutions. On the other hand, Australia exports wine to more than 50 countries.
So, Australia needs to increase sales in the domestic market. Only a handful of wineries in the Top 100 sell more than 20,000 dozen bottles and most are family-owned and run; they either have no dealings with the major retailers or do so with caution. They rely on distributors who service restaurants or fine wine retailers for access to consumers. Wine Australia’s October 2020 report shows that 17 per cent of total sales value is direct to consumer (DTC). But for wineries producing less than 20,000 dozen bottles, sales through this channel account for more than 50 per cent of wine sales value and grew by seven per cent in 2019-20 compared with the previous year. The big winner in the DTC category has been online sales, up 40 per cent, followed by database (self-generated), up 21 per cent, and wine clubs, up 12 per cent. The losers were events, down 24 per cent, and cellar door (physical) down seven per cent. Visitor numbers were down 23 per cent, but the average value per dozen increased five per cent to $241, exceeded only by wine clubs’ $251.
And so to this year’s Top 100, drawn from my database of more than 2800 wineries, 1165 of which were profiled in the 2021 Wine Companion. Of the top-rated wineries, 325 were invited to send six of their best wines. The headlines go to the four table wine sections of 20 wines: white wines under and over $25, and red wines under and over $30. I endeavour to cover a spread of varieties and regions but not on a pre-determined mix. The “big two”, chardonnay (19 per cent of the total crush) and shiraz (25 per cent), dominate because they present many different faces reflecting the different regions and climates in which they are grown without obscuring their varietal DNA.
Chardonnay dominates the white wine category but the variety and the category are of declining importance compared with shiraz and red wine. Chardonnay’s 2020 crush was the lowest since 2001 and the white category has been in decline since 2015. The area of chardonnay has decreased by 1000ha since 2015 while that of shiraz has increased by 1700ha. The battle between shiraz and chardonnay across all four price segments saw 16 chardonnays chosen, one more than shiraz.
Riesling secured 10 selections, pinot noir eight, grenache and cabernet sauvignon six each. Another 13 varieties or blends secured one to three spots. Riesling stands unchallenged as the white wine runner-up. Its best wines come from more than 10 regions across NSW, Victoria, Tasmania, South Australia and Western Australia. Bursting with lime/lemon flavours when young, it grows ever more complex over the next 20-plus years without losing its core of freshness. Semillon has only one spiritual home, the Hunter Valley, and isn’t as immediately attractive as riesling, even if it ultimately becomes every bit as complex.
Shiraz’s historical challenger, cabernet sauvignon, has been joined by pinot noir and grenache; merlot is a significant player as a blend option with cabernet in Margaret River. The competition in the over $30 red class was so intense that many of the inclusions had three or four equally worthy alternatives. All I can say is that this group is the distilled essence from the many thousands of red wines tasted for the Wine Companion and the Top 100.