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December 2022 – February 2023

The changing nature of the Australian wine industry

In 1997, I was offered the position of Professor of Oenology at Charles Sturt University. The offer came with the challenge of managing the teaching school responsible for the degree programs in oenology and viticulture as well as establishing a centre that focused on research, education, training and extension for the wine industry.

My appointment came at a time of massive expansion of the wine industry. Exports were strong, especially to the UK. This demand created a shortage of grapes. Priority was given to the export markets, with some larger companies actually importing wine from Europe to satisfy the lower-price-range domestic market.

In 1995, the industry released its 30-year Strategy 2025 outlook plan with the claim that ‘by 2025, the Australian wine industry will achieve $4.5 billion in annual sales by being the world’s most influential and profitable supplier of branded wines’. This bold claim led to a massive expansion in grape plantings across the country, driven by high grape prices as well as significant taxation advantages for new primary production activities. The new plantings were pushed to produce a crop in their second year. Extensive irrigation helped drive the new plantings.

The export market did not grow at the rate expected in the Strategy 2025 plan, leading to high stock-to-sales ratios. Fortunately, Yellow Tail opened up the US market, absorbing a large volume of excess grapes. In 2001, Yellow Tail sales to the US were about 225 000 twelve-bottle cases per year, increasing to 7.5 million cases in 2006.

Export markets are fickle. The increase in the value of the Australian dollar pushed up the export price. Wine exports are also something of a political football as recent events with China demonstrate, and the industry is now back in an oversupply situation.

Two factors have contributed to Australia’s success.

First, we are able to blend wine using grapes sourced from many different regions in the country. While we do have many excellent regional wines, our export markets were seeking wine that tasted the same from one year to the next. By blending from multiple sites, we were able to achieve this goal with great success.

Second, the industry has established a creative culture through education and research. Undergraduate degrees in viticulture and oenology as well as an industry-managed Vocational Education and Training (VET) program gave confidence to experimentation in grape growing and winemaking, resulting in successful production strategies.

The industry has always been committed to research, with its financial support being dependent on research focusing on industry priorities. The funding body required the research outputs to be developed into industry outcomes and the research to be shared across the industry. This highlighted the need for extension officers as the interface between researchers and industry.

The industry’s creative culture allowed winemakers to determine what additives should be used and when they should be added to get the most desirable outcome from the grapes. This led to the accusation that the ‘high tech’ approach produced industrial wine that did not reflect the characters of the region from where the grapes had been sourced.

Apart from the vagaries of the export market, the wine industry is now facing several challenges. Consumer demands are changing, with an increasing expectation that wines are made using sustainable practices. There is a clear move to organic and biodynamic wines. Natural wines and minimal-input winemaking are finding a niche market here, while being an expanding market in Europe. The focus for natural and minimal-input wines is hand-picked single-vineyard grapes that are fermented using indigenous yeast and bottled without fining or filtration.

Increasingly, wine companies are focusing on regionality. Many of the company tastings that I now attend are exploring single-vineyard wines produced by indigenous yeast fermentation to provide a clear representation of terroir. When I started in the wine industry, ‘terroir’ was considered a nonsense term and indigenous yeast fermentations would ‘only lead to spoilt wine’. We now have a better understanding of these concepts, and this is leading the way to open up new markets.

In my December 2021 column (p. 40), I described how sensory analysis is moving away from classical descriptive analysis to more consumer-focused methods such as ‘Rate-All-That-Apply’ and Pivot© Profiling. Sensory analysis using artificial intelligence (AI) has been examined ( The researchers noted that the purpose was ‘not to build an AI sommelier’, but a means of designing an energy efficient AI system.

The biggest challenge facing the wine industry is adaption to climate change. This is now a major focus of industry research and experimentation.

This is my final regular Grapevine column. It has been a great retirement activity over the last 11 years. In my first column on aged Hunter Valley Semillon in April 2012, I commented that the wine style ‘suggests that age has advantages over youth’. There does come a time when the wine stored in a cellar needs to be rejuvenated. The same also applies to those who write about wine!

Geoffrey R. Scollary FRACI CChem ( has been associated with the wine industry in production, teaching and research for the last 40 years. He now continues his wine research and writing at the University of Melbourne and Charles Sturt University. This is his final column.


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