Nelson wine right place right time

Nelson is often thought of as a paradise for potters, painters and alternative life-stylers. It’s a place which enjoys a lot of sun and where a significant proportion of the region’s economy is devoted to growing, harvesting and eating fresh food and wine. It’s also a place that’s beginning to attract the attention of the largest New Zealand wine companies.

As a wine region, it’s one of the smaller regions with only 35 wineries and 1,139 ha of vineyards (or 3% of the national vineyard stock).
Most of the wine companies are boutique, specialising in handcrafted wines and the region’s wineries tend to punch above their weight when it comes to winning awards. As an example, the family-owned and run Blackenbrook Vineyard have just won a gold medal and the trophy for best Gewurztraminer at the Bragato Wine Awards, which was their fifth "best wine in class" award at a national competition. Also, the family owned Waimea Estates states on its website that it has won 24 trophies and 133 gold medals in its 22 years of operation.

But the winds of change appear to be blowing, which could mean that the Nelson wine sector could look very different in the not too distant future. As the largest NZ wine companies continue to experience major growth in export markets thanks to the increasing demand for Marlborough sauvignon blanc, they are faced with big decisions as to how to secure future secure grape supply. Common wisdom has it that of the Marlborough region’s 28,000 hectares, 23,000 hectares are already planted, leaving limited opportunity for new development. This perceived shortage of developable vineyard land is causing the largest players to focus on their long term requirements and appears to be affecting expectations around Marlborough vineyard prices.  

With Nelson being only 115 kilometres from Blenheim, many of the largest players have looked to Nelson to source grapes and bulk wine. Whilst virtually all of that supply is used for blending into Marlborough sauvignon blanc, it has been encouraging to see some companies - such as Villa Maria who produce Leftfield Nelson Sauvignon Blanc as part of their Te Awa Collection – including Nelson sauvignon blanc in their brand portfolio.

To date, none of those larger companies have acquired existing Nelson vineyards or bare land for development but it is expected that the day when that happens is not too far away.

Whilst some may be interested in acquiring substantial vineyard holdings – although there are only 540 hectares currently planted in sauvignon blanc in Nelson  - it is also expected that some might be interested in adding premium boutique brands to their current portfolio as part of a drive to provide a more regional offering to their international customers.

Unlike the UK and Australian markets where most demand is specifically for Marlborough sauvignon blanc, consumers in the burgeoning US market are receptive to New Zealand sauvignon blanc, which could open the door for other regions in that market. Nelson producers – as well as wine companies from other New Zealand wine regions outside Marlborough - should be well placed to take advantage of this new and rapidly increasing demand.

The New Zealand wine industry has changed beyond recognition in the past 10 years and it will continue to change as it responds to ever increasing international demand. Looking forward ten years to 2025, it will be interesting to see the role that Nelson plays in delivering its exceptional wines to those international markets.

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