Squeeze on vintner eases, Chinese palates soften--http://www.cnwinenews.com

LESS than a month ago, winemaker John Ellis was contacted by a Chinese buyer keen on some decent Australian reds to import.

The buyer had sampled some of the product from Mr Ellis' Hanging Rock Winery and thought it was right for the Chinese palate.

This morning, after some rapid negotiations and jumping regulatory hoops at both ends of the transaction, 144,000 bottles will be loaded onto trucks at Woodend, north of Melbourne, before setting sail for the port of Shanghai in a $1 million-plus shipment that makes November the biggest export month for the winery.

But why the rush?

"Chinese New Year. The Chinese are very big on celebrations and gift giving, and Chinese New Year (which, next year, falls on January 26) is the major one. These wines literally have to make it for Chinese New Year — there's no alternative. We're on the fine end of that, at the moment. If they don't hit Shanghai before Christmas, chances are they'll languish of the docks for a while."

Mr Ellis, who has previously sold wine into Asia, visited China in May last year and said local consumers used to rice wines were being taught to appreciate broader flavours.

"Drinking, particularly rice wine, is a well established part of the culture. To shift it from rice wine to table wine is tricky in that everyone knows that the older a rice wine is the more palatable it's going to be. And therefore there's a feeling that the older the table wine is the better it's going to be, but of course we all know that's true to a point, but beyond that point it can be very very poor.

"I think Australia has got a lot of advantages over Europe. Our winemakers in Australia are producing wines that bridge that gap for them a little better than, say, clarets from Bordeaux. Our wines are generally softer and carry more fruit and flavour, which means that it's easier for the Chinese to make a transition to that palate."

The country is a small but growing market for Australian wine exports. The 13 million litres sent there in the year to September represents 1.9 per cent of Australia's total exports, and the total value is about $A65 million, according to figures from the Australian Wine and Brandy Corporation.

The success of smaller, boutique wineries comes at a time when some of the bigger players are struggling. In July, industry heavyweight Foster's wrote down $700 million from its global wine business, which includes the Southcorp wine operations in Australia.

Meanwhile, Constellation Wines Australia, formerly the Hardy Wine Company, is selling three of its 10 production facilities and more than 20 of its vineyards in response to drought and the high Australian dollar.

Strictly speaking, the latest deal by Hanging Rock is in fact three deals, each with Chinese importers keen to satisfy the local appetite.

The buyers are the well-connected Wei Ya International, Fujian Pan-Asian Pacific International and JHZ Group, whose Melbourne representative Leon Lim on Saturday visited the winery to check on the product. The drops that make up the stock are premium cabernet sauvignon and shiraz from the 2005, 2006 and 2007 vintages in bottles that will carry Hanging Rock's Odd One Out label, recently launched in Australia.

Mr Ellis, who founded Hanging Rock 26 years ago, exports his product to Asia, Canada and the British Isles. In European and American markets, the grape glut depressed prices of recent years gave Australian wine a downmarket reputation that winemakers are hoping to shed.

The first batch Hanging Rock exported to China came after an approach from a Chinese importer a year ago.

"It was a guy named Wei Wang, and he rang as he said 'Mr Ellis, you're a very famous wine maker, I want to import your wine to China.'

"I said 'Mr Wang, that's a very generous comment, thank you. Before we go on, though, would you like to tell me what price wine you're looking for.'

"(He said) 'Oh, about $20,' and I said 'That's a bottle, Mr Wang?'.

"(He replied) 'You don't think I'd insult a famous winemaker like you by offering $20 a dozen?'. And I said 'Mr Wang, you have my total attention.' "

Mr Wang has since ordered seven containers, or 84,000 bottles and, it seems, has whetted the Chinese appetite for more Australian wine.

Winemakers are holding more stock than their local and overseas customers can drink.