The Evolution of the Australian Wine Industry, c. 1870–1980

From Domestic Supplier to Global Brand: The Evolution of the Australian Wine Industry, c. 1870–1980

Australia is the world’s sixth largest wine producer. Moreover, of the approximately 1.2 billion liters produced in the country annually, roughly two-thirds or 800 million liters are exported abroad. But it was not always like this.

Wine was produced in Australia within a relatively short time after the British rediscovered the continent in 1770. A decent domestic industry had evolved by the mid-nineteenth century, and the geographic remoteness from Europe and North America reduced Australia’s export market for decades. Even when it did start growing from the 1890s onwards, it was prone to periodic setbacks. As the following explores, it was not until the 1960s that steady and long-lasting growth arrived.[1]

What is the origin story of Australian wine?

The origins of the Australian wine industry can be traced directly to the arrival of the First Fleet, a British armada of eleven ships that arrived in New South Wales in 1788 to establish the first colony there. On board were some vine cuttings made at the Cape Colony in South Africa. These were cultivated at the first governor of New South Wales, Arthur Philips’ house in Sydney, and early in 1791, the first cuttings were taken. Fermentation soon followed, and Australian wine was born.[2]

The Australian wine industry began slowly developing from the early nineteenth century onwards. Between 1820 and 1850, wineries were founded in increasingly large numbers in New South Wales, Western Australia, and Victoria, regions which would remain both the main centers of habitation and viticulture in Australia down to the present day. This was based on vines imported into Australia from Europe, South Africa, and the Americas.

As early as the 1820s, Gregory Blaxland was responsible for the first efforts to export Australian wine overseas. This was a novel development, though; it would be many decades before this was attempted in any sustained fashion. Meanwhile, in the 1840s, 1850s, and 1860s, key regions which have become associated with viticulture down to the present day in Australia, such as the Barossa Valley and Hunter Valley, were first planted with vines.[3]

Disease arrives

In the mid-to-late 1860s, word would have started to arrive in Australia that a curious disease was striking the vineyards of Europe and France in particular. These reports would have become more ominous over time, and by the 1870s, the disease had been named phylloxera and was wiping out much of France’s vineyards in the south.

Phylloxera, caused by a North American aphid, a sap-sucking insectoid, eventually reached Australia in the early 1880s. Owing to significant efforts, it was stomped out, and quarantine measures were introduced to prevent further invasions by it, efforts which continue down to this day. On the surface of it, the onset of phylloxera, which devastated the French wine industry in the 1870s and 1880s, ought to have been a significant hit to Australian wine exportation. But, still, the country continued to grapple with its geographical distance from other markets. In the end, countries such as Chile and Argentina were the actual beneficiaries of the temporary collapse of the European wine industry in the late nineteenth century.[4]

While Australia benefited only to a limited extent from the phylloxera epidemic back in Europe, its export market was beginning to gather pace. With it, the scale of the domestic industry expanded from the 1890s onwards. The primary market was Britain’s home country, but there was an impediment even in this. By the 1890s, a British wine merchant, Peter Burgoyne, had acquired a virtual monopoly on importing Australian wine into Britain. At one point, over 70% of all products from Australia were managed by Burgoyne to some extent. This fundamentally hurt the market as Australian producers rightly felt Burgoyne was gouging them on the profits.[5]

Export markets

While the export market remained limited, the 1900s and 1910s did see some fundamental developments within Australia. Irrigated vineyards were established extensively along the Murray River during these years, and the Barossa Valley and South Australia became the thriving heartland of the Australian wine industry. By 1930 over 75% of Australia’s wine was being produced in the state.[6]

By the time South Australia was coming to dominate the Australian wine industry, the country was also beginning to experience its first export boom. In 1932 a conference was held in Ottawa in Canada, between leaders of the British government and the main countries of the British Commonwealth, such as Australia, New Zealand, and South Africa. The goal of this was to come up with ways to help their respective countries’ economies in light of the ongoing Great Depression.

One of the results of the Ottawa conference was the implementation of the system of Imperial Preference. This dictated that Britain, and its Commonwealth allies, would favor buying goods from each other rather than from third-party nations. Thus, during the mid-1930s, Britain began reducing its reliance on French wine and purchasing it in vast quantities from Australia. Incredibly, by the dawn of the Second World War in 1939, this system was so successful for Australia that it had replaced French wine as the number one wine exporter to Britain.[7]

This boom was short-lived. The outbreak of the Second World War and the years of recovery afterward saw a shift towards Britain purchasing European wine, an act of neighborliness as France and Germany tried to repair their devastated economies. Moreover, although the war ended in 1945, rationing remained in Britain until 1949, and the wine market remained deflated well into the 1950s.[8]

Just as rationing was ending and the economic boom of the 1950s and 1960s was beginning, the Australian wine industry began to take on its modern appearance. Production increased as the practice of cold fermentation of white wine in stainless steel was introduced. Major wine companies, such as Coonawarra, were established in places synonymous with wine production today in Australia. Finally, there was an industry-defining shift away from fortified wine, of which much had been produced in Australia up to that time, to cheaper white and red table wines.

An export boom began in the 1960s, slow at first but gradually increasing. It probably would have sky-rocketed in the 1970s had it not been for the worldwide economic crisis of the mid-1970s. The export trade from Australia was particularly badly hit owing to high fuel prices associated with the Oil Crisis of 1973. But once all this receded and a new economic boom began in the 1980s, the global Australian wine industry, as we know it today, emerged.

Australia soon became one of the primary wine trading countries globally. Today it is unheard of for wine merchants not to carry extensive amounts of Australian wine. Moreover, it was in the 1970s and 1980s that producers in Australia began focusing on producing high-quality Chardonnays, Shiraz, and Cabernet Sauvignons. Thus, though it took nearly a century to do so, eventually, Australian wine cracked the international market and has become one of the world’s foremost wine producers.[9]

Going Deeper (Notes from Above)

Gregory Blaxland

Gregory Blaxland was a jack of all trades in many ways. In addition to attempting the first major operation to export Australian wine in the early-to-mid-1820s, he led the first-ever expedition of British settlers over the Blue Mountains in 1813. Blaxland’s wine-growing endeavors were based on vines he brought to Australia from the Cape Colony in South Africa. His export work peaked in 1822 and 1823 when he visited England to promote his product. While there, the Royal Society of Arts awarded him a silver medal for his vintage, importing it to Europe from the other side of the world, particularly in an age before the advent of steamships, proved a bridge too far in the early 1820s.[10]

South Australian Wine and the Barossa Valley

South Australia and the Barossa Valley became the thriving heart of the Australian wine industry in the late nineteenth and early twentieth centuries.

The region was hugely influenced in its viticulture by the large numbers of Swiss and German settlers who colonized it from the 1840s onwards. Many of these came from Silesia in south-eastern Germany, and the region was colloquially known as New Silesia. Because many of these settlers came from regions of Europe where, unlike their fellow British colonists, they had the experience of producing wine, they significantly influenced the development of viticulture in the Barossa Valley during the mid-nineteenth century.

That influence persists to the present day, and a dialect of German known as Barossa German is still spoken here in the early twenty-first century.[11]

Further Reading:

• Beeston, A Concise History of Australian Wine (Third Edition, Sydney, 2001).
• Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006).
• Janet Semler, ‘The Australian Wine Industry,’ in The Australian Quarterly, Vol. 35, No. 4 (December 1963), pp. 28–35.
• James Simpson, Creating Wine: The Emergence of a World Industry, 1840–1914 (Princeton, 2011).

On this Day

January 24, 1791 – The first two bunches of grapes to were successfully grown in Australia and cut from some vineyards in the governor’s garden in Sydney. The governor in question was Arthur Philips, the first lead administrator of the British colony of New South Wales, which had been established just over two years earlier in 1788. Cuttings for the vines had been brought to Australia and cultivated until they produced their first yield early in 1791, as related by a diarist of the time, Watkin Tench. The exact location at which this occurred can even be identified. The site where the garden of the governor’s house would have stood in 1791 is now occupied by the Hotel Intercontinental on Sydney’s Macquarie Street. Thus, unlike in most other countries, the history of the origins of viticulture in Australia can be mapped to specific sites in the country. It would soon become one of the world’s leading wine producers.[12]

July 21, 1932 – The British Empire Economic Conference was opened in Ottawa in Canada. This conference was called a meeting between the British government and industry members and those of other leading member states of the British Commonwealth, such as Australia, New Zealand, and Canada. The delegates aimed to foster new ways of helping their nations act in accord with each other to better their economic situations in the context of the seemingly never-ending Great Depression. One of the measures adopted out of the conference was the system of Imperial Preference, whereby Britain would favor importing goods from the other Commonwealth nations over those from third-party countries and vice-versa. One of the probably unexpected results of this was that in the years that followed, the amount of Australian wine being imported into Britain (which had been on the increase anyway during the 1920s) grew to be so large that by 1939 Britain was importing more wine from Australia than it was from France. This was an enormous boom in the growth of the Australian wine industry on the global stage.[13]

References

[1] For a succinct account, see J. Beeston, A Concise History of Australian Wine (Third Edition, Sydney, 2001); James Halliday, A History of the Australian Wine Industry (Adelaide, 1994).

[2] ‘Australia’, in Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006); Tate Adam, The First Vines (Sydney, 2006), p. 28; Alan Frost, The First Fleet: The Real Story (London, 2012).

[3] Oz Clark, Australian Wine Companion (London, 2004), p. 12; ‘Australia’, in Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006).

[4] Christy Campbell, Phylloxera: How Wine was Saved for the World (London, 2004); George Gale, Dying on the Vine: How Phylloxera Transformed Wine (Berkeley, California, 2011).

[5] James Simpson, Creating Wine: The Emergence of a World Industry, 1840–1914 (Princeton, 2011), chapter 10.

[6] ‘Australia’, in Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006).

[7] https://www.nationalarchives.gov.uk/cabinetpapers/themes/policy-protectionism-imperial-preference.htm  [accessed 14/6/22]; ‘Australia’, in Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006); Robert A. MacKay, ‘Imperial Economics at Ottawa’, in Pacific Affairs, Vol. 5, No. 10 (October, 1932), pp. 873–885; Donald MacDougall and Rosemary Hutt, ‘Imperial Preference: A Quantitative Analysis’, in The Economic Journal, Vol. 64, No. 254 (June, 1954), pp. 233–257.

[8] Ina Zweiniger-Bargielowska, ‘Rationing, Austerity and the Conservative Party Recovery after 1945’, in The Historical Journal, Vol. 37, No. 1 (March, 1994), pp. 173–197.

[9] ‘Australia’, in Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006).

[10] Jill Conway, ‘Blaxland, Gregory’, in The Australian Dictionary of National Biography (Melbourne, 1996), I, pp. 115–117.

[11] https://www.wineaustralia.com/whats-happening/stories-of-australian-wine/june-2016/barossa-valley-history-in-evolution [accessed 15/6/22]; Gordon Young, ‘Early German Settlements in South Australia’, in Australian Journal of Historical Archaeology, Vol. 3 (October, 1985), pp. 43–55.

[12] ‘Australia’, in Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006).

[13] https://www.nationalarchives.gov.uk/cabinetpapers/themes/policy-protectionism-imperial-preference.htm  [accessed 14/6/22]; ‘Australia’, in Jancis Robinson, The Oxford Companion to Wine (Third Edition, Oxford, 2006); Robert A. MacKay, ‘Imperial Economics at Ottawa’, in Pacific Affairs, Vol. 5, No. 10 (October, 1932), pp. 873–885; Donald MacDougall and Rosemary Hutt, ‘Imperial Preference: A Quantitative Analysis’, in The Economic Journal, Vol. 64, No. 254 (June, 1954), pp. 233–257.