CHANGING HABITS: Riverina Winemakers Association president Andrew Calabria said consumers were choosing more trusted brands for wine during the pandemic. PHOTO: Contributed

CHANGING HABITS: Riverina Winemakers Association president Andrew Calabria said consumers were choosing more trusted brands for wine during the pandemic. PHOTO: Contributed

Cask wine on the up as pandemic shifts wine drinkers' tastes

Diversity of MIA's wine industry key to strong recovery after COVID

Industry
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Consumers switch to trusted brands as closures to restaurants see sales fall.

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After years in decline, cask wine has recorded an increase in sales.

Retail sales of wine have also seen an increase as fewer people spend nights at restaurants because of the COVID-19 pandemic.

NSW Riverina Winemakers Association president Andrew Calabria said the full impact and how long the recovery would take was difficult to predict as new cases of the virus continued to be found.

"It's really hard to read data because we're right in it now," Mr Calabria said.

Mr Calabria said how each individual winery in the Murrumbidgee Irrigation Area (MIA) fared depended on how their sales channels were set up.

"If you set your business up as direct-to-consumer, mail order or online ... that avenue has gone ballistic," he said.

"Cask wines sales have increased for the first time in a long time.

"A lot of consumers have gone back to trusted brands."

Customers were also choosing wines based on value and Mr Calabria said value was much more than just cost - it could include the wine's quality, winery ownership or sustainability credentials.

Across the wine industry on-premises sales had seen big declines.

According to data published by Rabobank, there had been an 11 per cent drop in Australian wine exports to America.

Rabobank's senior wine analyst Hayden Higgins said on-premise wine sales in the US have crashed by 22 per cent, or US$68 billion.

Mr Higgins said it would mean Australian wineries would have to find new ways to get their product into the hands of US consumers.

But while Australian wine exports had fallen by volume, the dollar value of those exports had dropped by just two per cent in Australian dollars which suggested there was a focus on premium wines.

"While the on-premise sales are currently facing monumental challenges, the growth in e-commerce has been well-documented, and will provide an important opportunity for wineries seeking alternative growth strategies - both in the US, Australia and other markets," Mr Higgins said.

PRESENCE: De Bortoli Wines executive director Victor De Bortoli said a strong retail presence had helped offset declines in on-premises wine sales. PHOTO: Contributed

PRESENCE: De Bortoli Wines executive director Victor De Bortoli said a strong retail presence had helped offset declines in on-premises wine sales. PHOTO: Contributed

De Bortoli Wines executive director Victor De Bortoli said the pandemic meant many were waiting to see what would happen next.

"We're talking with our partners about retail distribution and are looking at steering products that way," Mr De Bortoli said.

While De Bortoli exports to America, it's not their only export destination and many markets were facing similar challenges when it came to on-premises sales.

Mr De Bortoli said a strong retail position in Australia was providing a stable environment for the winery.

He said while some wines typically enjoyed at restaurants were seeing decline, other wines in the retail market were seeing a spike.

"We had fantastic momentum going into January. We had other challenges including a higher cost of inputs but we were enjoying a good roll in to January and then February came along."

Mr De Bortoli said there was a clear change among consumers switching to brands which they trust and which represented value, and their values including sustainability.

While the on-premises wine lists could be a great billboard for wineries, it often required a lot of resources to make the investment pay off, especially in the American market.

"Having the list can tell the story through the details, variety, location and brand," Mr Calabria said.

Mr Calabria said the diversity of wineries in the Riverina would help support the post-COVID recovery.

"We're all really different, with all different sales channels and objectives," he said.

"The region is resilient, just this week we've had a meeting to talk about where we're going to do to attract people to the region."

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