Rising wine demand in China pushes up Penfolds prices

FLAGSHIP Foster's winery Penfolds has cited growing demand from China for the rising price of its top-shelf Bin range.

The latest Bin release, of nine wines, goes on sale today, ranging from the $30 Bin 51 Eden Valley Riesling 2011 to the $65 Bin 389 Cabernet Shiraz 2008.

With Bin 28 selling for about $15 a bottle just five years ago, global brand director Sandy Mayo said the rapidly growing Chinese export market was pushing up prices for local users of the sought-after tipples.

"It's driven by global demand -- all of these wines have demand far in excess of supply, and we're really seeing strong growth in markets like China, where Penfolds is a very in-demand brand, so pricing for the rest of the world rises, as we can't make enough to keep up," she said.

One enterprising Chinese winemaker sought to help the company meet this excess demand last year by launching a lookalike brand called Benfold's, using pictures of Penfold's chief winemaker Peter Gago in its promotional material.

Start of sidebar. Skip to end of sidebar.
End of sidebar. Return to start of sidebar.
Unlike the rest of the Foster's wine portfolio, which has been savagely pruned to remove unprofitable product categories, the Bin range has this year been expanded with the introduction of a new red -- 2008 Bin 150 Marananga Shiraz.

From the Marananga sub-region of South Australia's Barossa Valley, the wine is priced at $65 a bottle, ranking it alongside Bin 389, often referred to a "poor man's Grange" as it is matured in barrels previously used to make Australia's most famous red.

"The winemakers have been wanting to make the Marananga for a long time, and 2008 was such a perfect vintage they decided it was the right time to do it," she said.

The 2008 vintage was marked by 15 straight days of hot, dry weather in South Australia. However, Mr Gago said most of the grapes had been picked before the heatwave.

The company refuses to disclose production volumes, but the Bin wines are generally produced in larger volumes than the luxury range set for release on May 5, which includes Grange vintage 2006 and collectors' favourites such as Bin 707 Cabernet Sauvignon. Penfolds is considered the prime asset in the Foster's Treasury Wine Estates division.