High on anxiety, low on profit

After a decade of trouble-free growth, Australia's wine industry is experiencing growing pains, says Anthony Rose

Is it possible for any wine drinker not to have picked up the odd bottle of Jacob's Creek? Britain may be Australia's star export market but apparently there are still those here who shun wine from the new world for snobbish reasons. Where Australia has won its 6 per cent market share is in the unsnobbish, non-traditional market.

The key to Australia's success lies in the way it has exploited the marketplace with premium varietal wines, as popular for their generosity of fruit flavours as their value for money. Forty years ago, it made the transition from fortified to table wines, thanks to the inspiration of winemakers such as John Vickery and Colin Gramp. Since 1980, cost-effective mechanical farming and sophisticated cellar technology, plus marketing savoir-faire, have produced standards of quality and value that are the envy of the wine-producing world. Latterly, it has led the way in drawing back from overtly oaky styles.

The thrust of Australian viticulture and winemaking is aimed not so much at excellence per se as obtaining the best quality grapes and wines at lowest price. Australia is consistently able to produce superior quality fruit from high yields.This turns European theory - the lower the yield, the higher the quality - upside-down. With the benefits of technology, hygiene and expertise, producers have hit on the magic formula of optimum freshness, aroma and fruit.

Perhaps it is to be expected that after a decade of rapid and virtually trouble-free growth, Australia is experiencing growing pains. Now that the competition has learnt enough vineyard and cellar tricks to make its own palatable, cheap varietals, Australia has begun to see its popular base eroded by eastern Europe, Chile, South Africa and France's Languedoc- Roussillon.

Early signs of anxiety showed early last year. The confident announcement of an ambitious investment programme was deflated by an exceptional period of drought, accompanied by reduced harvests and grape price rises. Expansion is under threat, too, from a shortage of materials and skilled labour, rising production costs and a strong Australian dollar.

Plantings of premium grape varieties, especially cabernet sauvignon and chardonnay, have increased substantially and are expected to reach 58 per cent in 1997. But the growth rate is still well short of what is needed to meet expansion targets. Meanwhile, just treading water is tough going. Jacob's Creek, for instance, Australia's biggest-selling brand in the UK, lost at least 10 per cent of sales when it broke the all-important £4 price point.

Mike Paul, managing director of Southcorp UK, believes Australia faces two main problems: "The first is the need to maintain good value at under £4 to keep retailers interested. Unfortunately, that's where a bit of complacency is creeping in." He also believes traditional wine drinkers must be persuaded that Australia's premium wine sector (ie, over £5) is serious: "Australia is not just a land of varietals. We need to develop curiosity through our different regions and personalities."

This is happening via, for instance, the shift back to the shiraz, or syrah, grape, and the use of other Rhne varieties such as grenache and mourvdre. The Barossa Valley is making a comeback with its powerful, sweet oak shiraz, while cooler regions with more peppery northern Rhne styles, such as Western Australia and Victoria, are also expanding the repertoire. Enough to tempt the most snobbish of Poms.

Wines of the Week

Whites: Sainsbury's Australian White, £2.99. Palatably fresh, fruitily crisp dry white at an undemanding price. The pleasantly rounded Tarrawingee Semillon Chardonnay, £3.75, is on special offer (three for £9) during February.

1994 Pewsey Vale Riesling, £4.99, Tesco. Yalumba makes two distinctive vineyard rieslings: the bone-dry Heggies and this softer focused but flavourful lime-like riesling from Pewsey Vale.

1994 Oxford Landing Chardonnay, £4.95-£4.99, widely available. Benchmark, tropically fruity chardonnay.

1994 Samuel's Bay Barossa Valley Colombard, £5.99, Wine Rack, Bottoms Up. The refreshingly unoaked, juicy quintessence of the new "fruit- driven" Australia.

1994 Katnook Estate Riddoch Coonawarra Sauvignon Blanc, £5.99, Wine Rack, Bottoms Up, Thresher Wine Shops. This exotic sauvignon has goose-berryish fruit and a lively bite.

1993 Plantagenet Omrah Chardonnay, £6.95, Grape Ideas, Oxford. One of a new breed of chardonnays designed to maximise the pure fruit characteristics of the wine.

1992 Petaluma Chardonnay, £10.49, Oddbins, £10.99. The best vintage of this most delicately burgundian Australian chardonnay yet, with hints of oak smokiness and lingering vanilla fudge-like flavours.

Reds: 1993 Penfolds Rawson's Retreat Bin 35, £4.49, widely available. Succulent mint and blackcurrant blend of cabernet sauvignon, ruby cabernet and shiraz with robust tannins.

1992 Rowan Cabernet Merlot, Victoria, £5.49, Fuller's, Victoria Wine. Elegant, oaked bordeaux-style blend with vivid berry fruit.

1991 Plantagenet Shiraz, £7.95, Grape Ideas, Oxford. Expressive shiraz with a violets and pepper-like nose and a spicy fruitiness. The 1991 Cabernet Sauvignon, £9, The Wine Society, is equally good, a supple cabernet with a touch of capsicum. Both will benefit from ageing in bottle.

1992 Mitchelton Ill Goulburn Valley, £6.99, Bentalls, Kingston; Portland Wines, Manchester (061-962 8752). A Rhne-style blend of shiraz, grenache and mourvdre. Classically Victorian minty, almost sagey cool-climate aromas bely the intensely juicy, heady fruit.

1992 St.Hallett Old Block Shiraz, £9.99, Tesco (at Sandhurst, Amersham); Reid Wines (1992), Hallatrow, Bristol (0761 452645); Australian Wine Club (0800 716893). There is a deserved cult following for this rich, spicily oaked Barossa Valley shiraz, which ages beautifully.

1991 Henschke Abbott's Prayer Merlot/Cabernet, £12.55, Lay & Wheeler, Colchester (0206 764446). Intensely concentrated blackcurrant fruit, very pure and distinctive.