Grape imports ease shortage

By SIMON HENDERY

New Zealand's largest winemaker, Montana, will blend more overseas wine into some of this year's local production to make up the shortfall from a poor grape harvest.

It is also likely, with second-largest producer Nobilo, to raise prices.

Winemakers in several regions are counting the cost of this year's frost-ravaged harvest.

The national grape crush is expected to be less than 90,000 tonnes this year, a quarter less than last year's record 118,700 tonne harvest.

Hawkes Bay was worst-affected, but frosts also hit Gisborne, Marlborough and North Canterbury.

Montana's national vineyard manager, Tony Hoksbergen, said the scale of the frosts was the worst he had seen in 25 years in the industry.

As in the past, Montana will import overseas wine to blend into its local production. Its cheaper sauvignon blanc labels, for example, will be blended with wine from Chile.

Some of the company's premium labels will also be affected: a shortage of Hawkes Bay chardonnay fruit means grapes for Montana's popular Church Road Chardonnay will be sourced from other regions.

The company said it was confident it could maintain supply and quality.

"The financial effects of a vintage such as this are mitigated by the fact that all the wines from any particular vintage do not go to market in the year they were harvested," managing director Peter Hubscher said.

Red and sparkling wines are generally matured for at least 18 months.

However the combination of increased production costs and the strengthening of the New Zealand dollar were likely to lead to increased prices, especially for exported wine, Hubscher said.

"With the vintage not yet completed, we cannot yet give a clear indication of the extent of any possible price increase."

Montana said exports of sauvignon blanc would fall this year, rather than grow as forecast.

"This is extremely disappointing, but should be viewed as a short-term hiccup in Montana's planned long-term growth," the company said.

Nobilo Wine Group managing director Brian Vieceli said his company was also under pressure to raise, although the problem had been eased by new plantings.

Nobilo would also import wine to blend into some of its cheaper labels but, like Montana, Vieceli said quality would not be affected.

He said it was frustrating that the shortage of grapes meant the company was restricted to allocating available product, rather than fully marketing its wine.