Viva looks back on the year that was - and the year that lies ahead - for winemakers and drinkers.
As 2011 gets under way, it appears the goose that laid the wine industry's golden egg has been well and truly roasted. While wine drinkers feast on its carcass - the cut-price sauvignons that look set to continue through the coming year - there's been little cause for celebration among a growing number of wineries struggling to keep their heads above water.
The current oversupply has largely ushered in our wineries' woes and wine drinkers' joy. The vast 2008 vintage sent New Zealand into a tailspin of surplus, exacerbated by the global economic downturn and the strong Kiwi dollar that's been eroding export margins. This has meant plummeting profitability and prices for wine companies, while drinkers have been raising glasses filled by the resulting stream of rock-bottom bargains.
"The last two years have been an incredibly hard time, with the number of receiverships indicating it's been the toughest period in the industry since the mid-80s," acknowledges Philip Gregan, CEO of New Zealand Winegrowers.
Numerous vineyards are now up for sale, often on land that's seen its value subside, while a major spate of bankruptcies has seen some wine companies close their doors for good.
It was particularly sad to bid adieu last year to more established players such as Cape Campbell, Gravitas and Matakana Estate, as well as promising new labels such as Otuwhero.
According to a recent New Zealand wine industry benchmarking survey by Deloitte, things will probably get worse before they get any better.
Though the weather and the wine industry managed to limit the size of last year's vintage, the report voices concern over predictions that this year's harvest could weigh in at a record-breaking 300,000 tonnes or more, pushing supply further out of sync with demand.
It's not a crisis that has crept up on us overnight; it has followed a frenzied spate of vineyard planting at a time when there wasn't enough sauvignon blanc to sell. Now there's simply too much for our current markets to absorb.
Warnings were also apparent, if not widely heeded, from across the Tasman. Australia's success flipped over into excess some years back and it has been drowning in an even deeper sea of surplus wine ever since, that has seen vines pulled out and the industry desperately trying to reinvent itself.
Their domestic wine drinkers have been helping to soak up some of our sauvignon surplus, which has made some waves in its wine industry. As an attempt to restore national pride, and no doubt help boost local sales, this month Australian winemaker, Steve Pannell has been urging his countrymen and women to pledge to drink only local wines in his "All For One Wine" campaign.
Though I sympathise with the sentiments behind this well-intentioned protectionism, I'm certainly not going to recommend Kiwis boycott Aussie wines or just stick to our own. While we should certainly be proud of the great wines we produce, we shouldn't feel guilty about supping on a ripe Aussie shiraz - a style our climate could never produce - or enjoying one of the distinctive wines of Europe.
We don't have to adopt a parochial approach, but can still employ some tactical purchasing.
The Deloitte study highlighted that the little guys had been the worst hit by the current crisis; they averaged losses last year of more than 30 per cent compared with the 7 per cent profits made by the large companies. So when it comes to your wine choices, you can think about whether you're going to buy big or boutique.
Another strategy is to buy less but better. Instead of going for two cheaper bottles, where profit is often lowest, spend the same on a single one that will probably give its producer a better return. And it'll be better for your liver and waistline, both widespread concerns at this time of the year.
But it's not all doom and gloom as the current situation has promoted a wave of innovation in our vineyards and wineries. With producers forced to get more savvy with their sauvignon to create a point of difference, increasing numbers have turned their attentions to creating top cuvees of our flagship white grape.
In the winery there's also been more experimentation in crafting eclectic white blends, often using a mix of our aromatic varieties. And in the vineyards we're seeing exciting new varieties being planted and starting to produce wine, such as the promising Austrian aromatic, gruner veltliner.
The quality of the wines around at the moment isn't bad either. Many now on the market are from the generally good 2009 and 2010 vintages, which have also probably been given an additional shot of intensity following New Zealand Winegrowers' advice to growers to keep their crop levels down in an attempt to control the surplus.
Wineries are also now in a position to cherry pick the grapes that go into their wines. Some have cancelled grape contracts or started imposing strict penalty clauses for all but the best grapes, which - while bad news for growers - can only help augment quality.
So what does this year and the future hold for New Zealand wine?
"We don't believe the fundamental prospect for New Zealand wine has changed," maintains Gregan, who points out that there are still significant international markets for the country's wines. "We're focusing on the supply side, and if we get a controlled vintage in 2011, by 2012 and 2013 we can expect a return to more normal conditions."
However, with growers no longer able to produce the kind of volumes they had previously, he acknowledges "this won't be what was normal in the past".
The goose may have gone, but the phoenix of the New Zealand wine industry should rise again when these current flames burn out; but what hatches will be a different kind of bird.
Going up in 2011
* Groovy new grapes - look out for the likes of gruner veltliner and tempranillo
* Quality quaffing - wines are looking good from the excellent 2009 and 2010 vintages
* Burgeoning blends - a growing array of eclectic assemblages injecting new interest into the country's offerings
Going down in 2011
* Prices - those bargain bottles will keep a-coming for some time yet
* Wineries - more bankruptcies on the cards
* 2008 vintage sauvignons - hopefully there aren't many from this patchy vintage still lurking on the shelves, but if you spot any avoid all but those from wineries known for making long-lived examples
NEW WINES FOR A NEW YEAR
RISING STAR SYRAH
Mission Estate Hawkes Bay Syrah 2009 $16.50
Syrah is a rising star in our vineyards that looks destined to scale new heights in the year to come. With its aromatics of black pepper and spice over fresh and juicy plum fruit, this example from the historic Hawkes Bay estate offers an amazingly affordable taste of the up-and-coming variety. (From New World, Countdown, fine wine retailers.)
STILL SEXY SAUVIGNON
Lawson's Dry Hills Marlborough Sauvignon Blanc 2010 $20
There may still be too much in the system, but sauvignon blanc remains the nation's favourite grape, in terms of what we're buying, making and exporting. The 2010 vintage has produced some impressive examples, such as this intense sauvignon from Lawson's Dry Hills with its lithe lime and mineral core swathed in punchy passionfruit, basil and oregano. (From Liquor King, Bacchus Cellars, Epsom Wines and Spirits, Liquor Centre Glenview.)
Waimea Nelson Gruner Veltliner 2010 $23.50
Hailing from Austria, the first crop of gruner veltliners grown on our soils are looking extremely promising. This dry, zesty example has a hint of the variety's characteristic white pepper note, joined by subtle stonefruit, spice and a hint of jasmine. If you can't pronounce the variety, just call it "gruvee" like they do in the States. (Direct from the winery: waimeabrands.com)