AROUND THE WORLD – December 2006

12 December 2006 By db staff writer

“standfirst”>This month’s roundup of news from around the world

Gold Rush
Major medal haul for Leasingham following series of exceptional vintages in Clare Valley

Clare Valley’s historic Leasingham Winery has confirmed its status as one of Australia’s top cool climate wineries with a haul of eight gold and silver medals in this year’s UK-based international wine competitions. The winery also won awards for 70% of its wines entered in the 2006 Clare Wine show, including three gold and four silver medals.

Leasingham Winery’s renowned Rieslings were justly recognised; Leasingham Classic Clare Riesling 2002 received the IWSC Trophy for Best Single Estate Wine and Leasingham Clare Valley Magnus 2004 was awarded the Great Value White Award in the £5-10 category of the International Wine Challenge. Gold and silver medals were also awarded to the winery’s full-bodied Cabernet Sauvignon and Shiraz wines.

With 2005 and 2006 described as “near-perfect vintages” by winemaker Simon Osicka, Leasingham wines are sure to win further acclaim from critics. The mild 2005 vintage was a fantastic year for white varieties and the Riesling grapes were of a high enough quality to go into Leasingham Classic Clare Riesling, the winery’s flagship white wine which is produced only in exceptional years when it has the extract and structure to age beautifully. Ripe and concentrated Rieslings were also produced in 2006 but this vintage was particularly good for reds; with Osicka asserting that the 2006 Shiraz is the best since Clare’s stand-out 1998 vintage.

US Beer Commission

Craft brewers in Washington State in the US have united to create a state-sanctioned commission to assist in marketing to consumers.

The new Washington Beer Commission is made up of  microbrewers that produce less than 100,000 barrels per year. The commission’s roles will include the marketing of ales and lagers brewed in Washington state. Brewers will be charged 10 cents per barrel, to a maximum of 10,000 barrels per company.

The organisation will work alongside  the Washington Hop Commission. Washington State is responsible for nearly 75% of total hop production in the US.

The popularity of craft beer continues to significantly increase in the US, with the Colorado-based Brewers Association reporting an increase in volume sales of 11% for the first six months of 2006, compared with the same period in 2005. This also marks three years of consistent growth in sales.

In other US beer news, a considerable hike in the tax that brewers pay in Oregon has been proposed by the state’s senator. The justification for the increase is the rising cost of fighting substance abuse – it will be considered by the legislature in January 2007.

Latest EU recruits

Cigarettes, beer and soft drinks are the highest selling consumer goods in Romania, according to an ACNielsen report. Market research for the first eight months of the year showed that beverage sales in the country were worth over €730 million. Sales of cigarettes and beer accounted for €1 billion. In addition, an estimated €500m worth of coffee, soft drinks and mineral water were sold. Romanian cigarette producers estimate that 360 packs of cigarettes are sold annually per capita in the country.

Meanwhile, prices in both Romania and Bulgaria have been rising in anticipation of the countries’ accession to the EU in  January 2007. While major increases in the price of goods such as cigarettes and spirits are planned for the beginning of the year, prices have already begun to show increases. Consumer prices showed an increase of 3.8% from December 2005 to October 2006, according to the Bulgarian government.

Duty free-for-all

The draconian restrictions on carrying liquids and gels onboard flights, implemented in the aftermath of the summer liquid explosive terror plot, may have receded. But the European Travel Retail Council (ETRC) has issued a stark warning that the confusion that continues to surround the new regime could yet decimate the US$27 billion global duty free and travel business.

Latest figures suggest that upwards of 1,200 litres of alcohol are being confiscated each day, leaving consumers enraged.

ETRC president Frank O’Connell has issued a warning that long-term confusion could undermine consumer confidence to such an extent that the impact could rival the devastation wrought on the industry by 9/11 and SARS.

The industry celebrated a minor victory when the “sealed bag initiative” was approved in October. However, the latest EU legislation, implemented on November 6, is causing havoc for passengers transiting through Europe. Sealed bags have allowed travel retailers in Europe to resume selling liquor, but those who make a purchase (of more than 100ml) elsewhere then transit through the continent will have their goods confiscated.

Making a direct plea to travel retailers to take painful steps in order to protect the long-term future of the business, O’Connell commented, “I know that it’s very difficult for retailers everywhere to tell somebody ‘Please don’t buy this’, but in the long run for the future of airport retailing I think it’s crucial that we do this and we don’t have customers who have expensive products taken off them. Otherwise they’ll just say ‘To hell with this, I’m not buying at any [airport] shops anymore’.”

The global duty free and travel retail liquor trade is worth $4.76bn, and – as well as generating significant sales – the channel represents an excellent environment for building brands. Confusion over entitlements remains the biggest threat to the trade, as demonstrated by the chaos that followed the fragmented response to the abolition of intra-EU duty free sales in 1999.

Poison-free people’s Vodka

Russia’s state-owned alcohol producer Rosspritprom has announced plans to produce a low-priced own-brand vodka. The move comes in the wake of a spate of deaths since July caused by poisonous “vodka” made with various household and motor products including lighter fuel and brake fluid.

The number of people poisoned by fake liquor has rocketed since the implementation of strict new rules on registration and hygiene designed to protect consumers. As a result, however, suppliers have begun charging higher prices, resulting in an onslaught of counterfeit products. Dmitry Dobrov, Rosspritprom head of information, explained on the Echo of Moscow radio station that, “Rosspritprom will get no revenue from this project.” The brand, People’s Vodka, will be available in 50cl bottles from January, Priced at R60.

At the other end of the scale in Russia, premium Ukranian vodka Nemiroff has become the leading imported brand, according to National Association of Alcohol figures. Company chairman, Alexander Glus, commented, “Nemiroff’s leading position on the rating list of spirits importers testify to the fact that Russian consumers are more inclined to give preference to beverages that are guaranteed to give protection against counterfeiting.”

Hans off, warns Herzog

The herzog winery, a boutique operation in New Zealand, has been forced to change its name following the global registration of the name by the US-based Royal Wine Corporation’s Baron Herzog brand.

The brand has been renamed Hans, the first name of the winemaker who formerly lent his surname to the Marlborough-produced brand, which has a limited production of 3,000 cases.

Therese Herzog, Hans’ wife and partner, says, “We have very loyal customers and they know our wines intimately. Just as when you get to know someone you refer to them using their surname, it is the same with Herzog.” The decision takes immediate effect in the US and Europe, while the Kiwi Herzog is continuing its battle to retain the brand name in New Zealand and Australia.

EU steps up the pressure on India

The EU has requested that the WTO initiates a formal consultation with India over  wine and spirits customs duties. If, after 60 days of the proposed consultation the current duty dispute remains unresolved, a WTO panel may be established to decide on the matter.

The EU is arguing that duties levied by India on imports of wine and spirits, which can be as high as 550%, restrict access to the Indian market.

Talks were also held between the Scotch Whisky Association (SWA) and government officials in India in November, after which SWA chief executive, Gavin Hewitt, expressed his belief that, “It is time for India to implement its international commitments and allow fair access for Scotch whisky, just as Indian spirits have free access to the European market.”

In addition, Hewitt said he hoped that India would “take this last opportunity to agree reform to its discriminatory duty arrangements for whisky, without the need for a dispute settlement panel.”

James Bond 006

To celebrate the 2006 Beaujolais release last month, 27 high-performance cars, including the new Jaguar XKR (worth over £2m), participated in the annual Hackett Beaujolais Run.

Starting at Goodwood Motor Circuit, the two-day race culminated at Louis Jadot’s Château des Jacques estate in Beaujolais. Paul Brazier and Ben Taylor from Overbury Plc won this year’s charity run in a Lotus Esprit, both dressed as James Bond.

© db December 2006