Critical shortage of entry-level wines with 2018 vintage
With the 2018 vintage well under-way, there will be a critical shortage of entry-level red wines, from shiraz, cabernet sauvignon and merlot, according to an industry expert.
Booming exports to China are the main reason for the shortages, a major turnaround from just three years ago.Jim Moularadellis, of wine broker Austwine, says booming exports to China are the main reason for the shortages, a major turnaround from just three years ago. As well, a drop in the volume of grapes this vintage won’t help.
Extreme heat in January and February in the key South Australian areas of Barossa Valley, Clare Valley, McLaren Vale, Riverland and Mildura has had some impact on crop-levels, while the serious frosts in the South East of South Australia and Western Victoria last November also impacted yields from those regions.
Entry-level pinot gris is also in critical shortage, while commercial chardonnay and sauvignon blanc are in short supply.
Moularadellis said that winemakers were happy with the harvest but bean-counters probably not. Although the vintage is far from over, especially in the cooler southerly regions, he predicts the national crop will be down about 5 to 10% from last year’s record 1.98 million tonnes.
Quality is good. Dry growing conditions meant a relatively disease-free ripening period and harvest, especially in South Australia, where rainfall has been as low as half the normal over the past year. The dry conditions mean small berries and small berries mean concentrated, flavour-packed wine.
Regarding the ‘spectacular’ growth in exports to China, dominated by red wine:
“The growth rate is breathtaking: 63% during the past year and from a large base. China is now the biggest market for Australian wine by value. Furthermore, it is bigger than the next two largest markets for Australian wine, USA and UK, combined.”
Moularadellis also mentioned that while most of us assume commercial/entry-level chardonnay is plentiful, it isn’t. This is partly because the lack of Chinese demand for white wine has encouraged growers to remove chardonnay vines in recent years.
The drought-affected vintage in South Africa and a short vintage in France will also impact demand for Australian wine. The result is that there will be upward pressure on prices.