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Monday 1 September 2014

Yellow Tail maker to push US$100 wine

16th October, 2013 by Lucy Shaw

Casella Wines, makers of Yellow Tail, is due to give its US$100 wine brand a big push in order to attract new markets amid narrowing profit margins.

Casella’s managing director, John Casella, is looking to push his US$100, 1919 brand

Its 1919 range, which costs 13 times the amount of an average bottle of Yellow Tail, includes a Shiraz and a Cabernet Sauvignon made from grapes grown in the Barossa Valley, Wrattonbully and Coonawarra regions.

The range is named after the date the first Casella family vineyard was planted in Sicily by Giuseppe Casella on his return from World War I.

Australian winemakers are seeking new ways to increase earnings after being affected by a global glut of wine grapes and the strength of the Australian dollar against the US dollar.

Earlier this week, db reported that fine wine producer Tahbilk has been unwillingly forced to enter into the discounting game at Australian supermarkets.

Wines in the Casella stable, including 1919 (centre)

“We have to discount in order to remain competitive against the other brands, but it’s not a race to the bottom. The bigger wine companies can do that but it’s not where our future is,”  Tahbilk’s export sales manager Matt Herde told db.

At the other end of the market, Casella is due to launch a range of wine spritzers under the Bondi Road brand, which will be bottled at a brewery built with a loan from Coca-Cola Amatil Ltd.

The company will make use of lesser quality vintages that would otherwise be mixed into lower-value wine blends.

“They help us reach the consumer who might be drinking ready-to-drink bottled cocktails,” Casella’s managing director, John Casella told Bloomberg.

“They might jump to this and then jump to wine products,” he added.

Casella will also sell bottled Yellow Tail Sangria targeted at the US hispanic market.

Australia’s wine exports fell 39% to a 12-year low this year, according to Wine Australia. Casella however, has performed well in the US this year, with year-on-year sales volumes up 5% after a 0.2% decline last year.

The company put the recovery in part down to the picking up of the global economy.

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