Chardonnay or Riesling?

How is it that most chardonnays are now over ten dollars per bottle, most rieslings are less than ten dollars, but on a dollar for dollar basis most rieslings are infinitely better wines than most chardonnays?

Supply and demand clearly have much to do with this, but what are the consequences of the present trends? Could riesling face extinction?

Mike von Berg, Group Marketing Manager of Thos. Hardy and Sons is confident that he could sell hundreds of thousands of cases of chardonnay at what the Americans call a `fighting brand’ price of $4.99 to $5.99 per bottle, even if the wine only contained the statutory 80 chardonnay. He clearly can’t sell the same volume of rhine riesling, although he possibly has that quantity available.

“Although most chardonnay is now over the ten dollar mark, the next barrier is $20″, he states. Incidentally, the premium Hardys chardonnay, from their Collection Series, goes for a shade under $10, and that’s where he wants to keep it. “We’re building a brand”, explains von Berg.

The reasons for the high chardonnay prices are no mystery. We make a finite, but growing, amount in Australia, which we could easily consume ourselves. But understandably many companies are exporting their chardonnay to other countries where they can get a better price than in Australia for the same wine.

Chardonnay fruit in Australia sells at a base price of between $1600 and $2000 a tonne, three to four times that of rhine riesling. 1988 was a bad vintage for quantity, reducing supply in the face of an increasing demand both here and overseas. Prices will continue to rise, and the true impact of the shortage of premium varietals will be felt in 1989.

Next are the costs of production. Premium chardonnay requires new oak cooperage, generally from France. With our weakening dollar these costs have risen, and many wines on the market contain $1.50 or more of oak in every bottle, before a margin is attached.

Wine companies are also putting these costs against each separate product, so at Hardys the Siegersdorf Rhine Riesling is not paying for the oak in the Collection Series Chardonnay, for instance. “Why should it?”, asks von Berg.

On the other hand, riesling has faced a series of negatives. It has continually been confused with the generic riesling wines, it has oscillated between sweet and dry, and it has received bad publicity when plantings were uprooted. The Hardys Collection Rhine Riesling now has the word `dry’ prominently on the label.

Riesling is under-sold, under-priced and under-promoted, yet it is usually a better wine than the chardonnay of the same price. Some of the big companies don’t take it seriously. I recently tried a fabulous riesling from the 1988 vintage – a blend from Padthaway and Coonawarra. It was everything the variety could have produced, with classic aromatics, lemony-limey citrics and the whole works.

The company in question was intending to push the wine straight out onto the retail market. That was mistake Number One. Mistake Number Two was the price bracket – it was to go for a paltry $6.99. Mistake Number Three was to sell it all to New South Wales only – it was a wine worthy of nationwide coverage, and the company in question could certainly have used the publicity it would have generated for a current release table wine.

So rhine riesling continues its poor image while chardonnay gets more expensive. And now, despite the fact that there is almost as much chardonnay planted in Australia as there is riesling, it’s getting close to the stage when the average consumer cannot afford the stuff any more. What’s more, the average consumer is getting fed up, and I can’t blame him. But could history repeat itself?

Only a few years B.C. before chardonnay, rhine riesling was the grape. I can remember the excitement I felt when able to afford a gold-medal winning 100 Rhine Riesling for about $4.50! It was a Killawarra wine from memory, and a good drink too.

Winemakers all over Australia were told you could never plant too much of the stuff, but three short years later it had become a weed. Ripped from both Clare and Barossa Valleys, riesling became about as fashionable as flared jeans. And I believe that its present lack of image is as much a fault of the wine industry as any other reason.

Only a couple of years ago most of the generic rieslings in the country were 100 rhine riesling. It was the only way to sell the stuff. Instead of pushing up the image of these brands, the wines only served to push riesling’s nose further into the mud. And now, with less riesling to throw around, the generics have gone back to the columbard, the doradillo and the whatnot, and riesling has undoubtedly suffered in the process.

If riesling is going to recover its former status, its price and image will have to return to a more realistic level. In the long term this would benefit the consumer. Once the wine companies realise there is no money in premium riesling, then they will simply cease to make it, which would be a national tragedy.

However riesling’s future should still be optimistic. Across the board its wines are superior to anything before, with the Eden Valley, Clare, Padthaway, southern Victoria and Western Australia making great wine.

Overseas our rhine rieslings can’t sell using that name, but people are continually amazed by their flavour. Back home there is a real reaction to the plethora of over-oaked chardonnays, and riesling is the logical alternative.

Mike von Berg believes that the public are beginning to see that riesling represents a 100 pure classic grape variety, which the educated consumer is treating like a bargain. “It is a varietal wine true to type, and there are very few bad examples in Australia. I expect it to pull drinkers away from chablis and white burgundy generics”.

What of the future prices of both riesling and chardonnay? If you take into account the possible across-board price hike of 20-30 predicted by von Berg, riesling’s price should remain fairly stable. There is a shortage of rhine riesling in Australia, although it’s not nearly as severe as for other classic varieties in cabernet sauvignon, pinot noir, merlot, sauvignon blanc and chardonnay.

Expect chardonnay to continue its climb, as the $20 barrier gets closer all the time for a number of companies who have resisted so far. However von Berg suggests that the best chardonnays in Australia sell for between $10 and $20, and that the few over $20 are just not worth it when the alternatives, rhine riesling amongst them, are examined.

I don’t think it’s wrong for a company to sell its wine at a price it can fetch, no matter how high. And unlike many in this industry, I don’t mind seeing others make a profit. In the end it comes down to what the public, in Australia or overseas, will pay. But if the overseas end falls flat, be sure that so will the prices back home. Please login to post comment