Brexit an opportunity for NZ Méthode Marlborough

17th February, 2017 by Lauren Eads

The UK’s vote to leave the European Union could present an opportunity for New Zealand’s Méthode Marlborough sparkling wine, with import taxes likely to reduce as Champagne becomes more expensive, says winemaker Daniel Le Brun.

Daniel Le Brun, winemaker at No 1 Family Estate in Marlborough

Méthode Marlborough sparkling wines wines must be produced from Chardonnay, Pinot Noir or Meunier grapes grown in Marlborough, made in the traditional method with secondary fermentation in the bottle and aged for a minimum of 18 months on lees before disgorging. But while Marlborough has achieved global recognition for its Sauvignon Blanc, its sparkling wines have flown largely under the radar.

“The biggest challenge is to get the area recognition, for the style of wine we produce, in places like England and the US where Champagne is really dominant,” said Le Brun, winemaker and owner of No 1 Estates, speaking to the drinks business at a masterclass hosted by Méthode Marlborough – a co-operative of wineries working to raise awareness of region’s traditional method sparkling wines.

“One thing that will probably really help us is Brexit because that is going to sooner or later make Champagne more expensive in the British market. Also New Zealand won’t be penalised to the same extent as we are now, especially with sparkling wine. As you may be aware, when these wines come into the British market they have excise tax on alcohol produced outside of the EU, but there is an extra tax because it’s sparkling. That was imposed under the pressure of the CIVC. So we were unfairly penalised by the EU. We will have a more level playing field.”

Le Brun, who used to own Daniel Le Brun before the family sold it to Lion, moved to New Zealand from France in 1978 and settled in Marlborough with the intention of producing traditional method sparkling wine, digging underground cellars to age his wines.

“The place was very different compared to what it is now,” he recalls. “Vineyards were in their infancy, the place was without irrigation, there were no grain growers anywhere and there were a few hungry sheep that were roaming the plains. I was considered a bit looney at the time because I was trying to dig some underground cellars for the wine to mature and the locals were looking at me in a strange way. A few more loonies have followed me here since then.”

A selection of Méthode Marlborough wines on pour at the masterclass

Many of those “loonies” are now members of Méthode Marlborough, an organisation founded in 2013 by 10 wineries to help build greater recognition of their wines. Wineries involved include Allan Scott, Cloudy Bay Vineyards, Hunter’s Wines, Johanneshof Cellars, Lion (Daniel Le Brun), Nautilus Estate, Spy Valley, Summerhouse Wine Company, Tohu Wines and No 1 Family Estate, owned by Daniel Le Brun.

“We built Méthode Marlborough as a working group of different wineries with the same passion,” said Mitch Gardiner, general manager at Allan Scott Family Winemakers. “Consumers are picking up on sparkling wine and have a broader knowledge. I think the opportunity for us to have that market is very fresh now. It’s about getting it out there and showing the kids that the French aren’t the only kids on the Méthode market.”

“Marlborough managed to create a style a Sauvignon Blanc that was unique to the world and I think that probably follows through to the sparkling wine as well.”

But while Marlborough Sauvignon Blanc has provided a globally recognised geographical link for its sparkling wine, the region’s success with Sauvignon Blanc also presents its greatest challenge, with the Méthode Marlborough style often overlooked.

“Because Marlborough is so famous for Sauvignon Blanc, Méthode Marlborough is not famous as it could be,” said Andy Petrie, winemaker at Daniel Le Brun, who described Méthode Marlborough as one of the region’s “best kept secrets”.

“You don’t go looking for Chardonnay in Argentina. A region is often famous for one thing and that’s been really good for Marlborough Sauvignon Blanc. But at the same time, for other wines like Méthode Marlborough or Pinot Noir, it’s a challenge to get people to look at these wines because they are sort of on the sidelines, not because of the quality but because it’s harder to focus on them.”

Wither Hills vineyards in Marlborough

Currently, Marlborough has 24,365 hectares under vine, with Sauvignon Blanc accounting for 19,047ha of that, Chardonnay 1,047ha and Pinot noir 2,590ha. Consequently, one of the biggest challenges for Méthode Marlborough winemakers is sourcing enough grapes.

“We are competing for access to grapes and access to land”, explained Le Brun, “which is more and more taken over by Sauvignon Blanc. It’s quite difficult these days to find a grower that will sell you Chardonnay and Pinot for sparkling. Plantings of Chardonnay have been reduced and replanted with Sauvignon Blanc, so it is challenging.”

But with sales sparkling wine continuing the grow globally, rising by 80% in the UK in the past five years, according to figures released by HM Revenue and Customs last year, Le Brun believes there is an opportunity for Méthode Marlborough to grab some market share.

“I really think that over time the Methode Marlborough style will emerge internationally as a worthwhile alternative to Champagne,” he said. “It’s only going to get better.

“Champagne will always be Champagne because they are so good at what they do, but the sparkling market will definitely increase, so we will hopefully be seeing increased interest for Méthode Marlborough.”

2 Responses to “Brexit an opportunity for NZ Méthode Marlborough”

  1. Gilles says:

    What is this extra tax exactly on sparkling outside of the EU when coming to the EU ? As far as I know duty is 100% the same for sparkling in the UK.. even if they are produced in the UK.
    What is the truth ? Can anybody help ?

    • Lauren Eads says:

      Hi Gilles,

      In addition to standard VAT at 20%, imports of wine are subject to UK Excise Duty, which for still wine is currently £2.08 per 75cl. For sparkling wine it is higher – £2.67 per 75cl. So nearly 30% higher. If alcohol is imported into the UK from outside the European Union, customs duty also has to be paid, which varies on sparkling wine depending on the country. More info here – http://www.wsta.co.uk/resources/facts-figures

      Thanks,

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