Best New Releases from Australia
The Australian premium wine industry has been going through a rough spell in the American market in recent years, a situation made even more difficult by the surging Australian dollar, which makes Australia's wines more expensive for American importers. Compared to the boom days for Australian wine here in the early 2000s, the Aussie dollar has gone from about 60 cents to the U.S. dollar to parity and above, which means that importers can either raise prices (a bad move in a rough economy and with wines that are having a tough time finding an audience) or eat the difference. This run-up of the Australian currency has been going on almost unabated for a decade, with the exception of a brief, precipitous drop in late 2008, which has meant, said one importer, "that holding the price line for so many years turned us, essentially, into a charity."
To compensate for these issues most long-time American importers of Australian wine have been branching out to other suppliers like New Zealand, Argentina and even Europe to diversify their portfolios and reduce their dependence on low-margin Australian wines. They've also been dropping Australian wineries, even famous ones, and are now focusing heavily on value wines while severely cutting back their purchases of premium bottlings. All the importers I spoke with this year told me that they've been extremely careful about carrying inventory and have even skipped entire vintages from some producers if they think they already own too much inventory of older wines.
While the American market is undoubtedly important to high-end Australian producers, the fact is that their wines enjoy a robust local market, which is enhanced by Australia's heavily protectionist import tariffs. This has allowed more than a few producers who have a cult following at home to abandon the U.S. market, reasoning that they shouldn't struggle to sell wines stateside at a far lower profit margin when Australian buyers are lined up to buy everything at full retail. A bottle that sells for $50 in in the U.S. probably netted the producer about $25, or less, when they sold it to their American importer but they can sell the same bottle hassle-free for the full $50--or more--at home. That's a pretty compelling argument for many small producers. Unfortunately for American drinkers, more than a few of them, including some of the best, have gone that route and packed it in.
The silver lining for wine lovers in the U.S. is that the current selection of Aussie wines is the result of an extremely strict selection by the importers. If the wine isn't a virtual slam dunk, they really can't afford to take a gamble in the market I've described (and had described to me). Carefully curating a portfolio of Australian wines is paramount to the importers' survival and, luckily, the 2009 and 2010 vintages, which represent most of the red wines I tasted this year, were both strong in Western as well as South Australia. Two thousand nine in Victoria can be a dicey proposition because of epic brush fires that ravaged the region in early February, especially the prime Yarra Valley growing region. The most conscientious producers chose not to bottle smoke-tainted wines, so the chances of running across them are slim, at least in the case of high-end wines, which make up the bulk of wines I see from U.S. importers.