Most countries experience ups and downs with exporting wines to the United States. Australia’s hot, then it’s not. Argentina’s the next big thing, and then it’s scrambling to maintain shelf space. New Zealand, though, just goes up and up, even with a fresh tidal wave of Sauvignon Blanc about to crash on our shores.
New Zealand had a huge harvest in 2014: nearly 30% bigger than its previous high, which was 2013. That’s a lot of wine to sell, and for most countries it would mean a challenge, but the market drank it up. After a normal-sized 2015 harvest, this year’s harvest is super-sized again, almost as big as 2014. But don’t expectmany discounts.
Last year sales of New Zealand wines in the U.S. were up 17% by volume and 18% by value in the stores Nielsen measures. And that’s par for the course. New Zealand exports to the U.S. have nearly quadrupled in volume since 2006, according to New Zealand Winegrowers. There has not been a single year with a dropoff, not even in economic crisis years.
“If you look at the amount of wine consumed in the U.S., it’s about 375 million cases,” said David Strada, U.S. Marketing Manager for New Zealand Winegrowers. “We’re still less than 2% of the country’s consumption. We’re still little New Zealand.”
That is certainly the public perception, and it doesn’t hurt. In reality, New Zealand exports more wine than Portugal or Argentina.
Hobbit Power and Beyond
“When Sauvignon Blanc started getting really strong, from about the early 2000’s on, at that time, there were the Lord of the Rings movies,” says Ken Mudford, Director of Inventory for Sherry-Lehmann Wines and Spirits in New York. “There was the America’s Cup, which New Zealand won at that time. You couldn’t open the New York Times without there being an article about New Zealand of some kind. An awful lot of people visit New Zealand, too. Tourism is a major factor. When you do an in-store tasting, it’s amazing how many people have been to New Zealand. It always surprises me.”
Sherry-Lehmann might have more New Zealand wine than anywhere else in the U.S., with 140 SKUs, according to Mudford. Amazingly, less than half are Sauvignon Blancs.
But that’s an aberration. For all the media attention to Central Otago Pinot Noir, 93% of the Kiwi wine exported to the U.S. is white, and 86.5% of New Zealand’s total world exports are Sauvignon Blanc.
“They found a real niche with their Sauvignon Blanc,” says Terry Southard, a wine buyer for The Wine Library in New Jersey. “That trademark style really caught on. Not to mention, it’s a very affordable wine. Between $10 and $15 they’re able to make a Sauvignon Blanc that’s affordable and we’ll be able to make a good margin.”
You wonder when that gravy train is going to end. New Zealand increased its planted hectares by 50% in the last nine years. But many of the plantings are not Sauvignon Blanc, which means the country must sell more of its other varieties. The locals are helping—unlike export-focused Chile and South Africa, New Zealand has a healthy domestic wine market, with consumption up 24% last year alone.
New Zealand makes excellent Chardonnay (9% of the country’s plantings) and Riesling, as well as Pinot Noir that can be pricey. They’re not completely on America’s radar yet, but Gary Itkin, general manager and buyer for Bottlerocket Wine & Spirit in New York says, “It’s not a big stretch
for people.”
In fact, Itkin thinks a key reason that New Zealand wine hasn’t faced the kind of backlash that Australian wine did is it “checked the boxes” for sophisticated wine drinkers from the beginning: “They started with regional identification,” Itkin says. “It was New Zealand, it was Marlborough. It was New Zealand, it was Martinborough. There were already demarcated areas. When Australia was working through its popularity, it didn’t really matter where [wine] came from. It just became a general wine. It was Shiraz, that’s it. Every country has regional differences, but if people aren’t told it’s important, they don’t learn
it’s important.”
So there’s no reason to expect this wave to lose its potency anytime soon. Even with no more Hobbit movies on the horizon, Middle Earth’s wine industry just stays magical.
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