just-drinks.com editor's weekly highlights
In This Issue...
I trust the Christmas and New Year break (if you had one) has set you up for what already looks like a very lively 2007. There is a wealth of challenges and opportunities out there for us all, that should keep us entertained and, when it comes to drinks at least, you can be sure that we here at just-drinks will continue to give you the news you need, when you need it – good or bad.
It’s a tentative start to 2007 for the wine companies of Australia, however. Although the wine glut of the last year or so appears to be coming to an end – most forecasts predict a major drop in volumes for this year’s harvest thanks to frosts and droughts – the wine consumer has got very used to crazily low prices for Australian wine in the UK. Constellation’s third-quarter figures, released last week, serve as perfect confirmation of this.
I remember at the end of 2004 visiting California and talking to many winemakers about how the region had been performing since the Millennium. The phrase that regularly cropped was “a perfect storm scenario”, used to describe the plague of problems they had as more vines were planted and terrorist activity, coupled with the burst of the dotcom bubble, hit the industry hard.
Australia faces a different set of issues. It has the opportunity to drive prices up as supplies of juice run well short of 2005 and 2006 levels. But the question remains, can they convince a market to pay more when it has got so used to buying from the bargain bin? If they can’t, Australian winemakers face a storm all of their own.
The wine industry is a truly cyclical beast of boom and bust, with rare exceptions serving only to prove the rule. The promised land of a steady ship has proved difficult to attain for some Australian wine companies – the beleaguered Evans & Tate is a perfect example.
We’ll keep you posted on Australia’s claim for just such a position. In the meantime, the country’s period of unbelievable growth seems to demand payback. Could that be the scene being set for 2007?
For further comment on Australia’s quandary, click here.
Until next time...
Olly Wehring, Managing Editor
The outlook in Champagne is upbeat, with sales on the increase in France and export markets, and the prospect of continued growth. However, writes Richard Woodard, challenges remain for Champagne shippers, not least how to sustain steady growth as rising demand pushes up prices.
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