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| June 13th 2007 |
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| Germany: Cool Climate Riesling on a Roll |
by Richard Grosche
German wine is in a class of its own. Although the growth in domestic demand cannot be ignored, the success of cool climate Riesling in export markets, especially the United States, is perhaps the best indicator of Germany’s standing in the wine world. Compared to France, Italy or Spain, Germany is a small wine-producing country. With an average...
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...annual production of 9 million hectolitres, Germany is only the ninth largest producer in the world by volume. While German wine is well known worldwide, and can be found today in the best restaurants from Sydney to Seattle, it was a different story 10 or 15 years ago.
THE THIRTEEN WINE REGIONS
While Germany’s vineyards cover 102,000 hectares, those of Spain, France and Italy each cover eight to twelve times that area. And although the individual winegrowing regions of La Mancha, Bordeaux, Languedoc-Roussillon and Sicily are each bigger than Germany’s entire vineyard area, it is authenticity and individuality and not size or volume that have brought German wine into worldwide focus. The country’s unique climatic and geological conditions enable its winegrowers to produce wines that are distinctly different from those produced in any other country. Moreover, even within the smallest individual growing regions, variety is the norm, and numerous grape varieties, manifold soils and unique microclimates allow for the production of a broad spectrum of wines.
Germany is divided into 13 growing regions, six of which are located in Rheinland- Pfalz. This federal state alone accounts for 67% of Germany’s vineyards and includes the two largest regions, Rheinhessen and Pfalz, as well as the fifth, the Mosel.
With the exception of Saale-Unstrut and Sachsen in the east, all of Germany’s wine-growing regions are concentrated in the south and south-western parts of the country. They are among the most northerly wine regions in the world, and straddle the border between the humid Gulf Stream climate to the west and the dry continental climate to the east. Long growing seasons and moderate summer temperatures produce elegant wines with relatively low levels of alcohol and a lively acidity. But except for this natural freshness and balance, it is difficult to ascribe a common trait to German wines.
Rheinhessen
Germany’s largest wine region, Rheinhessen, covers an area of slightly more than 26,000 ha. Rheinhessen is dominated by white varieties, which account for 67 % of the vines. Müller-Thurgau is the most widely planted variety with 16 percent of the total acerage, Dornfelder is second (14%) and Riesling third. Rheinhessen ranks second in exports.
Pfalz
With 23,363 ha under vine, Pfalz is Germany’s second-largest wine region by area. Pfalz is second only to Mosel in area planted with Riesling, but other varieties such as the different types of Pinot also play an important role.
Baden
Baden is the southernmost of Germany’s wine regions and the third-largest by area, with 16,000 ha. Comprised of nine districts, Baden has many soil types and grape varieties. Spätburgunder (Pinot Noir) accounts for 36 percent of the total acerage. Most of the wines from Baden are sold and consumed in Germany.
Württemberg
With more than two thirds of |
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its vineyards planted with red wine varieties, Württemberg ranks as Germany’s premier red wine region. The main variety is Trollinger, which is seldom found outside of this region. In Italy, however, it is wellappreciated as Schiava or Vernatsch.
Mosel
With slightly less than 9,000 ha under vine, Mosel is Germany’s fifth-largest wine-producing region. However, when it comes to Riesling, no other region world wide has more hectares planted than this region, which is also known as Mosel- Saar-Ruwer. Mosel leads German wine exports.
Franken
Part of Franken wines’ singular personality is due to the climate: cool winters, high annual rainfall and long, warm autumns. Franken wines are traditionally bottled in a Bocksbeutel, a squat green or brown flagon with a round body. A true speciality of the region is Silvaner.
Nahe
Although the Nahe is one of the smaller German wine regions, with slightly more than 4,100 ha, its extraordinary range of soil types is second to none. Riesling from the Nahe is well appreciated by wine drinkers, not only in the region. However, production is rather small.
Rheingau
Rheingau is one of the most distinguished wine regions of the world, and a paradise for Riesling fans. Rheingau wines have a long tradition in export markets. Erstes Gewächs is the new category for premium dry Riesling from Rheingau.
Saale-Unstrut
Saale-Unstrut is among the northernmost of Europe’s traditional wine regions. Yields are low, and the wines are true rarities that are hard to find outside the region.
Ahr
Four out of five bottles of Ahr wine are red, and most of these are Spätburgunder (Pinot Noir). The region has long established itself as a heaven for Pinot lovers, with some of the best German Pinots.
Mittelrhein
Classified by the Unesco as a world heritage site, Mittelrhein is not only a beautiful region but also the origin of some exceptional wines, especially Riesling. Hessische Bergstrasse Riesling and Müller-Thurgau account for two-thirds of the 436 ha under vine. The wines tend to be fragrant and rich, with a fresh acidity and finesse.
Sachsen
Sachsen is Germany’s easternmost wine-growing region, and its smallest. Many of the small parcels are planted on steep stone terraces along the Elbe river close to Dresden.
Germany has always been a producer of fine wine, but its export markets traditionally demanded quantity, not quality. While there was a lot of German wine available in many markets, it was not always the best ambassador for the country’s wine industry. But as Germany started losing volume share in some tradi - tional key markets beginning in the 1980s, it made up for the loss with better quality. The positive reception German wines are now receiving abroad is also reflected in the average export price paid per litre, which has now risen for the sixth consecutive |
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year.
If German wines share one common trait, it is their uniqueness. The country produces wine from many indigenous and rare grape varieties, as well as from international ones. They are too many to name, but the five most prominent are Riesling, Müller-Thurgau, Spätburgunder, Silvaner and Dornfelder. Each accounts for between 5 an 20% of Germany’s vineyard area; together they make up 59.3% of the total number of hectares under vine.
On some of its traditional wine markets, Germany is still known mainly for its sweet wines. These, however, are no longer really representative of Germany’s wine production. While in 1985 sweet wines accounted for 64.1% of the total production, in 2005 their share was down to 40.8%, with dry wines representing the strongest growth and semi-dry, or halbtrocken, wines showing only a slight change.
Structure of production
Although Germany’s slightly more than 100,000 ha of vineyards are in the hands of about 60,000 wine growers, the number of wineries is smaller. The vast majority of growers own less than one hectare and either deliver grapes to cooperatives or shippers (Kellereien); only about 10,000 wineries market their wines themselves. As in other wineproducing countries, it is not only the small boutique wineries that produce topquality wine, but also large shippers, who can easily choose between thousands of different lots for their premium ranges.
Winzergenossenschaften, or cooperatives, have become important players not only on the local market, but also in exports. They are responsible for about 33% of Germany’s wine production and control 31,453 ha across all 13 regions. In some wine-growing regions their influence is decisive: the share of wine produced by cooperatives in Baden, where the country’s first cooperative was founded in 1881, is 75%. In Württemberg it is even 79%. The region with the smallest share of wines produced by cooperatives is Rheinhessen, where only seven out of every hundred litres come from a Winzergenossenschaft.
The other group of major players are the wine cellars, or Kellereien. Sometimes their branded wines are better known on export markets than domestically, and some brands do not even exist on the German market. This is true for the two bestknown and best-selling exported German wine brands, Blue Nun and Black Tower.
Since some of the large shippers have specialised not only in German wines but in those of other origins as well, it is difficult to give precise figures for how much German wine is marketed through this group of producers. Last but not least, there are the estates, or Weingüter. Some have only one or two hectares, others ten or twenty times that area. Estates with more than 50 hectares, however, are a rarity. The estates produce wine mainly from grapes grown in their own vineyards. Some wineries, in addition to their estate bottlings, have branded wines in their portfolio. Good examples are the “Dr. |
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L.” from Mosel winemaker Ernie Loosen, “Dragon Stone” from Josef Leitz in the Rheingau and “Butterfly” from Geltz Zilliken on the Saar.
Major markets
Steffen Schindler, Director Export Marketing of the German Wine Institute DWI, just announced the latest export figures for German wine. The value of total wine exports rose by a record 19.8% to € 561 million, and volume increased by 10.3% to 2.9 million hectolitres. In the US value increased by more than 29%, and there was also doubledigit growth in Scandinavia, especially Norway, where sales doubled last year. “The turnaround has been well managed,” says Schindler.
“Riesling is the driving force behind the success on the export markets.” For years German wine was often considered cheap and sweet, but the world wine media has been praising Germany’s dry and succulent, naturally sweet Rieslings, and the Wine Spectator just called 2005 “Germany’s Golden Vintage”. It was a great vintage, but there have been many excellent vintages in recent years that have not had that much recognition abroad, such as 2004 and 2001, which are both very classical and of excellent quality.
The UK has traditionally been the strongest market for German wine. This is still the case in volume, but the US is already in a strong second place in value. Within only a decade, the US has tripled its imports of German wines, from $38 to $119 million, with further growth expected due to the Riesling boom. Holland still is the second largest market for German wine in terms of volume, but in value it has long been overtaken by the US. Although Norway is now in fourth place by value, it imports 90,000 hectolitres less than its neighbour Sweden, which is the fifth most-important market by value.
The biggest increase in 2006 was in Russia, which showed an increase of 173% in volume and 114% in value, making it the fifth-largest importer of German wine by volume and the sixth by value. German wine has profited from Russia’s growing thirst for wine, especially bottled wines.
In the bulk sector Germany is not even listed in the top 10. China, a market with gigantic potential, is hard to locate in the export statistics. While its volume is less than 1% of UK’s imports, in export value it ranks 21st, with €2.9 million. Japan is still strong, but without the positive dynamics of the rising markets of Canada and Sweden.
EXPORT IS BOOSTING RIESLING
In the 19th century, the most exclusive and prestigious wines to place on a dining table were Rhine Rieslings and Bordeaux. While the finest Bordeaux châteaux have managed to defend their position throughout the years, as the demand for naturally sweet and dry white wines stagnated, Riesling had several difficult decades on the export market. Riesling has now experienced a renaissance and charms the world with a flavour spectrum unknown in any other grape |
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variety, varying from fresh and crispy to full bodied and seductively sweet, always with a refreshing acidity.
Another strength of the “queen of white wines”, as Riesling is often called, is the vine’s ability to express the different types of soil where it is grown. Germany has, in fact, always been known for its immense variation in soils, not only from region to region, but even from vineyard to vineyard, and no other varietal expresses this diversity so well. Some of the most prominent vineyard sites, or lage, have appeared on the labels of fine wine for centuries and, although an official classification has never taken place other than for taxes, wine lovers recognise their Berncasteler Doktor, Wehlener Sonnenuhr, Kiedricher Gräfenberg, Westhofener Morstein or Forster Kirchenstück, to name but a few of the best Riesling sites. Although the share of white varieties in total area under vine was an overwhelming 88.6% in 1980, it had decreased to 63.1% by 2006. Despite this general decline of white varieties, Riesling still covers one-fifth, or 20,794 ha, of Germany’s vineyards. Furthermore, as Riesling leads the statistics in new plantings, its share is expected to grow even further. In worldwide terms, Germany devotes the most hectares to Riesling and claims 61.9% of the world’s Riesling vineyards.
Australia comes second, followed by France. The world’s other wineproducing countries together account for only 15% of the world’s Riesling vineyards. Riesling is the undisputed queen in its native country, and it is no wonder that not only the finest Rieslings, but also competitive volumes come from Germany. There are not only the rare super premium Rieslings, but also easy-drinking, refreshing Rieslings for everyday and every occasion are also produced.
The Pinot Noir trend It was not just the hype following the film Sideways that again brought Pinot Noir, or Spätburgunder, to the global consumers’ attention, but the seductive wines made from this grape. Spätburgunder is a diva, very sensitive and delicate, but blessed with the potential to produce wines that perfectly reflect their terroir. This is one clear parallel to Riesling, but there are more. Neither variety can deal well with extreme heat. Both need lots of sun to ripen properly, but their fruit aromas become scorched when the vineyard gets too hot. Furthermore, both prefer cooler night temperatures.
If the nights are too warm, the acidity is reduced and the wines lack finesse. It is no wonder that Spätburgunder has an equally long tradition as Riesling in Germany – the country offers ideal climatic conditions for these delicate varieties. The German regions with the highest number of hectares planted with Spätburgunder are Baden (5,800 ha) follwed by Pfalz, Rheinhessen and Württemberg, which each have 1,200 to 1,600 ha. A region that is not of any importance as far as volume is concerned, is Ahr. Here, some of the best |
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German Spätburgunder is grown, but the number of bottles produced is too small even for the domestic market. This has brought prices for some super premium Ahr Spätburgunder to € 50 and more a bottle. The situation in Rheingau is somewhat similar, with excellent wines in very limited quantities. Other regions have also increased their Pinot Noir plantings.
In Baden alone, more Pinot Noir is grown than in the whole of Australia (4,424 ha) or New Zealand (4,020 ha). In 2005, 13% of all new vines planted in Germany were Spätburgunder. When looking at Pinot Noir’s share among the newly planted reds, the dominance of Spätburgunder is clear, with 39%. Actually, Pinot Noir covers more hectares in Germany than in any other country in the world except for France and the US. In France, Pinot Noir covers a total of 26,337 ha, nearly 40% of the world’s Pinot Noir. While in the US the area planted to Pinot Noir stands at 13,236 ha, Germany comes third with 11,660 ha, placing it in a good position for exports. So far, it is only a niche product outside the country, but demand is rising, not only in neighbouring markets but also overseas.
Despite the general euphoria for Riesling, which has boosted Germany’s exports of fine wine, and the increasing demand for Spätburgunder, one should not forget the other specialities like Silvaner, Weiß - burgunder (Pinot Blanc), Grauburgunder (Pinot Gris), Dornfelder and Germany’s second most-important grape variety, Müller-Thurgau, which is experiencing a small renaissance in Italy. And it is not just still wines that deserve attention: German Sekt – sparkling wine – has become a true trend amongst German wine lovers. Germany’s repertoire is immense and is always worth tasting.
RHEINHESSEN PFALZ MOSEL
Six of Germany’s 13 wine-growing regions are located within the borders of one federal state, Rheinland-Pfalz, and together account for 67% of the country’s wine production. In terms of volume, however, Rheinhessen, Pfalz and Mosel- Saar-Ruwer take the lion’s share in exports.
Ahr, Mittelrhein and Nahe produce some excellent wines, but their volumes are too small to make an impact abroad. By vineyard area, Baden and Württemberg are the third- and fourth-largest wine-growing regions, respectively, but since most of the local production is drunk in Germany, their role in export is still rather small.
Although Rheinhessen, Pfalz and Mosel-Saar-Ruwer account for 90% of all exports of German quality wines, their individual rankings vary from market to market. The Mosel-Saar-Ruwer is the strongest German region represented in the United States. Its 166,539 hectolitres (hl) account for 69% of all fine German wine imported. Rheinhessen, despite exporting more than twice as much wine to the America as the Pfalz, lags far behind. When it comes to price per litre, Mosel also leads, with €3.37 in 2006.
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These figures become even more interesting when looking at the expected growth of the US wine market. Most experts believe that America will be the world’s largest market by 2010, when they estimate annual volume will be 27.3 million hectolitres. The two grapes with the highest increase in market share are Riesling (more than 29%) and Pinot Noir (more than 30%) – both grapes that Rheinhessen, Pfalz and Mosel-Saar-Ruwer have in their portfolio.
In Great Britain, the market reveals a totally different picture. Rheinhessen has the largest market share among German wines, with 54%. In value per litre, Rheinhessen, Pfalz and Mosel are on the same level, with average prices ranging from €1.59 (Pfalz) to €1.62 (Mosel) to €1.65 (Rheinhessen), compared to an average of €1.48 a year ago. So, while Germany has been losing significantly in volume, the demand for better quality wine and thus higher prices has also been felt on the British market.
Rheinhessen
Germany’s largest wine region has more than 26,000 ha under vine and offers a broad choice of varieties and styles. The average producer owns more vines here than in any other wine-growing region in Germany. Müller-Thurgau is still the variety with the largest area under vine, but Dornfelder and Riesling have shown the highest increase over the past few years. Dornfelder, a comparatively young German crossing, has been a great success over the past decade. Although its fruit-driven red wines are much appreciated by German wine drinkers, Dornfelder has not played any significant role in exports so far. Among the in digenous grapes, Rheinhessen has the highest number of hectares of Silvaner under vine worldwide, which has prompted the region to introduce a new category: RS for Rheinhessen Silvaner. For adventurous wine drinkers around the world, Rheinhessen offers high potential, and is also in pole position in terms of volume, with every third bottle of German wine produced there. Nearly one-third of Rheinhessen’s total volume of wine is exported, and the UK, despite losses over the past few years, has remained Rheinhessen’s largest market abroad, with some of the best-selling branded wines sent there.
Traditionally, the British have viewed Rheinhessen’s wines for little more than everyday drinking. To a certain extent this is still the case, but it is the enormous increase in quality that has brought about the most changes. “Volumes down significantly, value nearly stable” best describes the state of Rheinhessen in the UK. In 2005, 146,360 hectolitres of Rheinhessen wine were exported to Great Britain at an average price of €1.41 per litre, or €20.6 million in total. In 2006 volumes fell to 116,879 hl, while value decreased only slightly to €19.3 million. This clearly demonstrates the tendency towards lowers volumes, but higher quality.
In the US, where Rheinhessen is not yet well represented, 2006 saw a healthy increase in volume as well |
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as value. While the US market bought only 46,376 hl of Rheinhessen wine in 2005, this rose to 52,850 hl in 2006 – and the average price per litre increased from €2.45 to €2.64, taking the total from €11.4 to €14 million. Rheinhessen, with its 3,500 wineries, cooperatives and wine cellars, is in an excellent position for further growth.
Pfalz
Bordered by Rheinhessen to the north and France to the south and west, Pfalz’s vineyards stretch almost without interruption for nearly 80 kilometres (50 miles) at the foot of the Haardt forest. Modern technology and viticultural training have made their mark here in the past four decades. And if there was one word to describe Pfalz’s wine production accurately, it would definitely be “dynamic”. Over the past decade, almost no other region in Europe has shown such vigour and such a resolute willingness to break with set patterns and adapt to new conditions.
Formerly unknown producers have become world-class estates, and mass producers have successfully transformed their wineries and vineyards into highquality sites. While the number of producers has declined, the remaining estates have more area under vine. The choice of grapes has also changed. Besides the classical Riesling, Spätburgunder, white Burgundian varieties and Müller-Thurgau, new varieties (such as Dornfelder) and international varieties (such as Chardonnay, Merlot, Cabernet Sauvignon and Syrah) have shown excellent results in Pfalz. The current trendy variety on the German market, Sauvignon Blanc, is more widely planted here than in any other German region.
These changes have influenced the position of Pfalz wines on the both the German and foreign markets. In Germany, Pfalz has become a brand, and consumers associate it with well-structured, unique wines that are excellent value for money. This message has yet to be fathomed by export markets, where the Pfalz is still in third place behind the Mosel and Rheinhessen.
But the region makes up in diversity what it lacks in total sales. Some small- to medium-sized wineries sell to far-off destinations like Taiwan, Singapore and Canada, while Japan remains a very good market, especially in the super premium sweet wine sector.
With the largest area of red varieties under vine, in particular Pinot Noir, the Pfalz is well positioned to participate in the next trend beyond the Riesling boom. And there is yet another product that the Pfalz is known for in Germany: rosé. Six out of 10 bottles, or 61.8%, of rosé sold in the German off-trade come from the Pfalz. For many years, rosé’s position was endangered, because consumers simply ignored it, but it has lately become somewhat fashionable, at least in the summer months, and demand has grown significantly in most markets. So far, rosé exports are hard to define statistically, but that could change quickly. In Holland, for example, rosé’s market share is now up to |
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12.3%, while in Belgium it is 11.7%.
What is especially interesting is the average price that Dutch consumers pay for different wine types. While the average price for a bottle of wine in Holland is only €2.63, rosé commands the highest average bottle price of all wine styles at €2.78. Great Britain, at 6.1% market share, sells 501,000 hl of rosé in the off-trade.
Mosel
Beginning on the 1 August 2007, the region known as Mosel-Saar-Ruwer will be officially renamed Mosel. Producers may use the old name until 1 August 2009 at which time only Mosel will be allowed to appear on labels. When talking about Mosel, wine drinkers always have Riesling in mind, and it is no doubt the region that started the Riesling boom. It is here that most of the best-selling Rieslings originate, and in no place else in the world are more hectares devoted to Riesling.
Although each of the Mosel, Saar and Ruwer Rivers’ vineyard area produces a wine with its own distinctive personality, the three share a family resemblance, combining a delicate fruitiness with mineral flavours and a crispy acidity unknown in any other wine the world over. The reason for this uniqueness is terroir. Along the serpentine course of the Mosel, the river banks rise so sharply that the vineyards carpeting these slopes are among the steepest in the world, with some planted at an astounding 70-degree gradient. On these precipitous inclines, nearly all labour must be done by hand. The reward for this hard work is an excellent reputation among wine lovers as well as the highest average prices paid for German wine in export markets.
Despite its relatively small size compared to Rheinhessen and Pfalz, Mosel- Saar-Ruwer is the leader in exports by value, especially on the important American market, where value and volume have been rising continuously. While in 2005, the Mosel exported 136,254 hl worth €44.6 millions, in 2006 it was 166,539 hl at a value of €56.3 million, and 2007 started with a further increase. In total, the region exports 35–40% of its production of 840,000–980,000 hl. Besides the US, the other important markets are Great Britain, the Netherlands, Japan, Scandinavia and Belgium.
Another interesting aspect of the Mosel area is the average size of its wineries, which is a mere 1.7 hectares. Only 63 producers have more than 10. Not many wine producers of that size in other regions would even think about marketing their wines themselves, but on the Mosel, even the smallest manage to export a part of their production. It is the sheer demand for Mosel Riesling that makes this possible.
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