REGIONAL ANALYSIS SUBDUED OPTIMISM 2/08 MEININGER’S WBI 2/08 MEININGER’S Writers have long been fanatical about German Riesling, but the public largely ignored it, deriding it as sweet plonk. Although it is too early to celebrate, Joel B. Payne finds that producers are pleased with the success they enjoyed in 2007. iesling is strong, but rising grape prices and a weak reports Armin Wagner, export manager for Blue Nun’s owner dollar are putting pressure on everyone’s margins,” says F.W. Langguth Erben, “but demand for our off-shore varietals is RMartin Henrichs, sales director at the Moselland coopera- rising. Consumers see us as a credible brand, but not tive, with a hint of apprehension. “2008 necessarily German.” will separate the wheat from the chaff.” 1 Benchmark Data www.de Indeed, being German has not always Steven Schindler, the export manager Inhabitants: 82.2m been an advantage. In fact, even at home at the German Wine Institute is more Germans long spurned their own wines Per head annual consumption: 23.7 litres optimistic. “Not only is the export value and bought French labels when they had of German wine rising, our reputation Area under production: 102,000 hectares guests for dinner. That has changed, abroad is on a roll.” however, particularly for white wines, Domestic production: 1bn litres That may be an overstatement, but but it is nonetheless revealing that the there is no question that Germany Market share of imports: 54% two largest international German brands is slowly coming of age in the wine – Black Tower and Blue Nun - not only world’s pecking order. Liebfraumilch, do not have German names, but are not which accounted for 45% of all exports even sold in Germany. in 1975, has fallen to 20% and Exports rebound been replaced by a myriad of buyers- own-brands like Gallo’s Polka Dot, According to the Monika Reule, the colourful labels and smaller estates. newly anointed manager of the German Over that time, Black Tower has Wine Institute in Mainz, the value of grown from next to nothing to a million wine exports from Germany increased cases a year, making it Germany’s by 13% to €635m in 2007 - and the aver- largest wine brand, followed by Blue Nun, which has enjoyed age price rose slightly to €2.03 per litre. Export volume also renewed success since modernising its label and adding line increased by 8% to 3113m litres. Both figures, however, also extensions, in the manner of Lindemans, from southern France include foreign wines re-exported by German shippers, which and Australia. “Not everything has worked out as planned,” account for almost a third of both value and volume. 2 Top ten grape varietals in hectares 3 Colours in the vineyard 5 Riesling vineyards worldwide Wine ha 2007 % ha 1982 % Colour 1980 1996 2007 Country hectares % White Grapes 64,466 63.2% 78,695 88.4% White 88.6% 80.0% 62.2% Germany 21,722 62.0 Riesling 21,722 21.3% 17,625 19.8% Red 11.4% 20.0% 37.8% Australia 4,256 12.8 Müller Thurgau 13,924 13.6% 23,240 26.1% Germany’s vineyard surface was once principally planted with white France 3,350 10.1 varietals; red grapes were mostly used to make rosé. Today over a Silvaner 5,261 5.2% 8,815 9.9% third of the vineyards are planted with red varietals - to produce red USA 1,700 5.1 Pinot Gris 4,413 4.3% 3,115 3.5% wine! In particular, Pinot Noir has become a key resource and is Austria 1,643 4.9 Kerner 3,848 3.8% 5,250 5.9% beginning to acquire international attention. New Zealand 636 1.9 Pinot Blanc 3,598 3.5% 800 0.9% 4 Flavour profile of German wines Canada 440 1.3 Red Grapes 37,560 36.8% 10,327 11.6% 1985 1998 2007 South Africa 347 1.0 Pinot Noir 11,820 11.6% 3,470 3.9% Dry 16.1% 29.4% 37.7% Chile 288 0.8 Dornfelder 8,185 8.0% 85 0.1% Off dry 19.8% 20.6% 23.1% Total 32,857 100 Portugieser 4,551 4.5% 2,850 3.2% Sweet 64.1% 50.0% 39.2% Although there are significant plantings of Riesling in eastern Europe, no precise data on vineyard area are available. Trollinger 2,504 2.5% 1,960 2.2% German wines are considerable drier than they were a generation ago. This trend, which is clearly visible on the domestic market, is Total 102,026 100% 89,022 100% SOURCES: 2:GERMAN MINISTRY OF STATISTICS | 3: MEININGER’S WINE BUSINESS beginning to find acceptance abroad. INTERNATIONAL | 4,5: GERMAN WINE INSTITUTE 54 SOUTHGERMANYROMANIA AFRICA KEY GERMAN WINE EXPORTERS 1 Peter Mertes German wine exports: 35m litres 6 F.W. Langguth Erben German wine exports: 9.5m litres WBI 2/08 MEININGER’S In der Bornwiese 4, 54470 Bernkastel-Kues Dr. Ernst-Spiess-Allee 2, 568412 Traben-Trarbach Phone: +49 (6531) 55-0 www.mertes.de Phone: +49 (6541) 170 www.langguth.de Director: Michael Willkomm Although this is the largest shipper in German, Director: Ralph Hintz By value, Langguth is Germany’s fourth largest Turnover: €200m they have few own labels. Instead their spe- Turnover: €89m shipper; but it remains an anomaly among the Total volume: 200m litres cialty is being flexible enough to create buy- Total volume: 38m litres major producers in its rigid defense of its own German Share: 70% of bottled product ers-own-brands for their customers with the German Share: 40% brands, several of which it markets interna- Exports: 38% packaging, label and price they need for their Exports: 65% tionally. Best known in Germany for its Erben Main brands: Mostly buyers-own brands markets. Not surprisingly, this company’s Main brands: Blue Nun, Erben label, it is Blue Nun that most foreigners asso- Main export markets: Nothern Europe, USA, turnover grew by 10% in value and even more Main export markets: UK, Russia, USA ciate with Germany. Interestingly, that brand Netherlands in volume last year. is not sold domestically. 2 Zimmermann-Graeff & Müller German wine exports: 25m litres 7 Andreas Oster German wine exports: 6m litres Marientaler Au 23, 56856 Zell Weingartenstrasse 1, 56812 Cochem Phone: +49 (6542) 419-0 www.zgm.de Phone: +49 (2671) 6005-0 www.weinkellerei-oster.de Director: Johannes Hübinger Although still strong with buyers-own-brands, Director: Andreas Oster Andreas Oster is known domestically as a key Turnover: €145m this company has repositioned itself over the Turnover: €70m supplier of the Aldi Nord discount chain. Like Total volume: 107m litres past few years with several ranges of higher Total volume: 50m litres his best client, he refuses to divulge any infor- German Share: 65% Exports: 50% quality own labels. In particular, the fighting German Share: 60% mation on his export business, so the above Main brands: Michel Schneider, Zimmermann varietal brand Michael Schneider has shown Exports: 20% data are estimates. As the company has no and Rudolf Müller impressive growth. The company has also been Main brands: Buyers-own brands export brands, it can only be recognized by the Main export markets: UK, Benelux, USA, successful in improving international aware- Main export markets: UK, USA bottler’s name in fine print at the bottom of Canada, Scandinavia ness of German red wines. the lable. 3 Reh-Kendermann German wine exports: 21.5m litres 8 Binderer St. Ursula German wine exports: 4m litres Am Ockenheimer Graben 35, 55411 Bingen Lerchenstrasse 66, 80995 München Phone: +49 (6721) 910-0 www.reh-kendermann.de Phone: +49 (89) 31400330 www.ursula.de Director: Nikolaus Schritz, Carl Reh Although nominally only the sixth largest Director: Peter Binderer Binderer was principally a wine importer Turnover: €80m German shipping company, Reh-Kendermann Turnover: €65m active in Munich until the family purchased Total volume: 45m litres has always had a strong focus on German Total volume: 42m litres the St. Ursula cellars in Bingen in 1987 and German Share: 80% Exports: 65% wine in export. Best known for Black Tower, German Share: 12% developed the Devil’s Rock brand, which Main brands: Black Tower, Kendermann and which with over one million cases sold is Exports: 27% includes a Riesling from the Pfalz and a Pinot Carl Reh Germany’s largest wine brand, the company Main brands: Devil’s Rock Grigio from Rheinhessen. The company also Main export markets: UK, North America and also boasts innovative ranges under the Main export markets: USA, Scandinavia and promotes the Dunávar brand from Hungary, Scandinavia. Kendermann and Carl Reh labels. Canada where it has been active since 1990. 4 Schmitt Söhne German wine exports: 20m litres 9 Valckenberg German wine exports: 3.75m litres Weinstrasse 8, 54340 Longuich Weckerlingplatz 1, 67547 Worms Phone: +49 (6502) 409-0 www.schmitt-soehne.com Phone: +49 (6241) 911116 www.valckenberg.com Director: Thomas Schmitt Although almost unknown on the domestic Director: Wilhelm Steifensand In business for over 222 years, Valckenberg is Turnover: €48m market, this company is a key export player, in Turnover: €18m the largest German shipper specializing in Total volume: 20m litres particularly in the United States, where it is Total volume: 3.75m litres moving small estate brands, with a large German Share: 100% the market leader. Still strong with classical German Share: 100% selection of some of Germany’s most well- Exports: 98% generic brands like Hoch, Piesporter and Exports: 100% known producers. In addition, the company Main brands: Blue Riesling, Liebfrauenmilch Liebfraumilch, the company has recently been Main brands: Madonna, numerous small estates also has its own label, Madonna, which has Main export markets: USA, UK, Netherlands revamping its product line to include more Main export markets: USA, Japan been the largest selling German wine in Japan modern styles.