250 Best wines
Something magical happened in 2010. The UK Government gave a big, fat, juicy chunk of money to the UK wine industry. This has never happened before. I’m not actually sure that the UK Government has ever given money to any alcoholproducing business. But this year they gave a £380,000 grant to an initiative called ‘Wine Skills’ at Plumpton College, home of Britain’s Wine School. The Wine Skills initiative provides tuition in sparkling and still winemaking, vineyards and grape growing, and business and marketing. These last two really matter. I’ve been out looking at our new vineyards round the south of England and I’m amazed and excited by their extent and ambition. But I’m very concerned about what they’re doing to do with all these grapes, and who’s going to buy all the wine. Plantings have more than doubled in the past five years, and the Champagne varieties – mostly Chardonnay and Pinot Noir – have increased by more than 600% in the same period.
You can see why. Sparkling wine sells for a lot of money. Prices have been rising by a pound or two a bottle every year recently as wineries have genuinely struggled to keep pace with demand. The prices for Champagne-style English fizz range from about £17.99 to above £35. And the wines sell out. So far. The price of vineyard land in the south has more than quadrupled in the last few years. The French Champagne producers are keen to enter partnerships and to buy land. On a recent English vineyard trip, every vineyard I went to had enjoyed a recent visit from very serious Champagne producers. Champagne is all about money. They don’t muck about. They must have been certain they could make money here. And the price of English grapes is mad just now. You can get up to £2,000 a ton for a grape like Chardonnay. Decent Australian Chardonnay is going for nearer £200 a ton this vintage. I smell a boom–bust. If English fizz is now £20 a bottle and we’ll be seeing anything from three to six times as much wine on the market in a year or two, the price won’t hold. We’ll have to see cheaper bottlings. Maybe even distress-priced bottlings – and will those be of good enough quality to keep our custom?
The 2012 Olympics may soak up a fair bit. The 350th anniversary of the Englishman Christopher Merret, the guy who invented Champagne – yes, he was English, not French – may help. But I fear a bout of re-adjustment is just around the corner. And it won’t be pretty. A glut of English grapes? Yes. Welcome to the Real World, England. This year, producers can’t get enough grapes and are paying some of the world’s highest prices. Two years’ time, you can’t give them away and they’re left to rot on the vine? And all those bright-eyed investment schemes go down the tube? It could happen.
Grape gluts. They always lead to tears. You can parrot on about ‘those who do not learn from the mistakes of the past are condemned to repeat them’ but wine people don’t learn. Whenever times are good, people flood into the vineyard and winery business. You try to tell them to be cautious – they don’t listen. It’s a rising market, everyone’s getting rich. It’ll go on for ever. Does that sound like the last decade of our economy? But nothing lasts for ever, particularly in the fashion-sensitive and, frankly, not massively profitable world of wine.
Australia is the most obvious example at the moment. Australia virtually created our modern British world of wine, Australian wine – its lovely flavours, its fair but never cheap prices – made us all into wine drinkers. Exports soared, and from a standing start a generation ago, Australia is now the leading supplier of wine to the British market. Sounds fantastic. Except that this was achieved by deserting the great original proposition of overdelivering for the price per bottle and instead following a mutually destructive path of deep discounting and gouging for market share. Australia still holds top spot here – just. But at home much of their wine world is in meltdown. Already this year, 8000 hectares of vines have been ripped up. Experts reckon at least 35,000 hectares need to go – over 20% of the national plantings. The giant Foster’s operation (Wolf Blass, etc.) is selling 7,200 hectares – much of it excellent fully planted land – for whatever price they can get. Constellation (Hardys is their biggest brand) is offloading $200m of assets at what people reckon is about 25% of their true value. Tim Adams, one of the Clare Valley’s top winemakers, snapped up the famous Leasingham vineyard from Constellation for less than it would have cost him to plant it. The world-famous Roxburgh vineyard, producer of the iconic Rosemount Chardonnay of the 1980s and 90s, has just been sold to BHP Billiton. But they’re coal-miners. Correct. The fabled Roxburgh vineyard is now more valuable for coal than for grapes. There’s a surplus of 100 million cases of wine in Australia. It could be 200 million by 2012. And experts reckon that of the 2420 wineries in Australia, 2000 would go bust if subsidies were removed. Luckily you’ll find quite a few of the high-quality survivors in this guide – still over-delivering, still in business.
But the boom–bust contagion can spread. New Zealand would seem to have followed an exemplary course of high quality, high price, and measured expansion. They almost got away with it, but Marlborough Sauvignon was seen as just too much of a cash cow. Money poured in. Plantings spread 30–40 kilometres up the river valleys, past where vines traditionally grew and, predictably, in 2008 and 2009 vast harvests produced – yes – a glut. Cheap Kiwi Sauvignon swamped the British market. It really hit home for me when I saw a 3 for £10 offer on Marlborough Sauvignon late last year. New Zealand exports were up 57%; they’ve now overtaken Germany in the UK. But at what cost? They still command the highest average price per bottle, but it’s dropped from £6.58 to £6.05 in a year, and it’ll be lower next year. Marlborough’s hardwon status has been savaged in a welter of discounting. Grape gluts again. Greed getting the better of experience. And experts reckon that at least 300 of New Zealand’s wineries are virtually insolvent. It takes a long time to build a reputation, and a very short time to lose one.
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