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ADT suppliers up their Oz bids as competition ramps up from China and the US

Published:  24 January, 2018

A hardy – dare we suggest, typically Australian – attitude to price hikes and supply challenges was the main exhibit at yesterday’s Australia Day Tasting, where plenty of creative and business flair set out the category’s stall for 2018.

The event is one of the top dates in the Australian wine calendar thanks to the UK’s long-standing status as its top volume market, amounting to a 28% share in 2017, according to Wine Australia.

The UK cannot make the same claim with value – that title goes to China, with 30% of value share, followed by the United States (19%) and the UK (14%).

But despite a possible dip in value sales in the UK recently, exhibitors at yesterday’s tasting shared an enthusiasm for premium listings, including Conviviality’s wine buying director Simon Jerome.

“Premium OZ is doing really well,” he said, pointing to Yarra Valley’s Oakridge and a handful of other higher-tiered labels which attended the event for the first time.

“Our portfolio spans mainly the mid to premium range because that is where we’re seeing growth. I think we’re going to see entry-level drop, particularly in the on-trade, because of things like the new trade deal with China. Exports to Oz were up 43% to China last year. This something we really need to be thinking about with Brexit on the horizon.”

It seems several companies are upping their stakes in Australia at the moment, looking to not only grow sales but to secure supply in a time when wine is short.

Such is the case with Alliance Wine, with their continued expansion of Thistledown Wine Company’s Riverland project, focusing on old vine Grenache; and also Broadland Wineries with its new deal with Pinnacle - the alcohol division of leading Australia retailer, Woolworths Group – which will vastly ramp up Oz distribution for Broadland when its brands start being shipped to the UK in the next few months.

The first of these labels will debut at this year’s LWF, which – regional sales manager Graham Hallworth confirms – Broadland will be attending.

“Key companies aren’t going to be there again this year,” he said of the fair. “The cost is high, but for us it’s about securing those London accounts, which are the most competitive and where we have most competition from others.”

The Pinnacle deal will significantly increase Broadland’s share of Australian bulk shipments to the UK, which account for 80% of all wine shipped to our shores.

Broadland is also looking to embark on a completely venture, with plans to supply one of the other fastest growing competitor markets for the category – the US.

“There has been a lull there for the past few years but that’s picking up again,” owner Mark Lansley told Harpers.

“Once volumes get to the right point we’re hoping to open a plant in north America.”

Alongside that, future collaboration between Lansley and Paul Schaafsma was also a topic of conversation at the Broadland stand, following the latter’s swift departure from the company earlier this month after just three as CEO.

Lansley said: “It became clear with his expertise in brand building that Paul is on a good place to run his own business. We’re looking into ways we can collaborate.”

Join us for more on ADT on Friday, when we will look at the growth of Rhone Valley varietals and hear more from Giles Cooke MW at Alliance Wine on the importance of Thistledown – their “anchor” in the Australia market.