A frenzy for the Aussie Grange

Adelaide, Australia

THEY met three weeks ago, as they do every year, gathering in a stark white room with bright fluorescent lighting. Wearing white lab coats, 10 men walked quietly to their usual spots at the table.

In silence, they considered batches of fermented grape juice of the 2003 harvest from top vineyards throughout South Australia. As always, it was a blind taste test.

“The less you know about the batches, the better,” says Steve Lienert, a winemaker and participant in the annual exercise. The tasters’ teeth soon were black from the unaged wine. “We’re a dentist’s nightmare,” Lienert says with a laugh.

At the end, the number of each batch was called out and each man declared his judgment. It was a separation of the great juice from the merely good. And it was the beginning of the 2003 vintage of one of the world’s great wines: the exuberant Shiraz called Grange.

Unlike any grand cru wine in the world, with the exception of some Champagnes, Grange is a blend of grapes grown on any one of 100 vineyards located as much as 1,000 miles apart. Every year, a committee selects the grapes. To ensure the wine’s style and consistency, old Grange winemakers don’t retire. They stick around to consult.

It’s a process that flies in the face of what most American vintners, as well as critics, applaud as ideal winemaking practices: artisanal winemakers working independently with estate-grown fruit that reflects a specific place and grape variety.

But when the 1998 vintage was released last month, it sparked what some critics are calling a hysteria. Collectors have been madly snapping up the fewer than 9,000 cases produced, sending prices to the moon.

Released at a steep $400 a bottle, the 1998 Grange now is selling for more than $800, in league with the celebrated 2000 vintage from Bordeaux’s first-growth chateaux. A member of the rock band Tool, Maynard James Keenan, paid $47,387 for a six-liter imperial of 1998 Grange at the Penfolds Barossa Rare Wine Auction in late April, setting a new record price for an Australian wine. The previous record was $36,363, also for an imperial of 1998 Grange.

“It was a good year in the vineyard,” says Peter Gago, the new chief winemaker at Penfolds, the Australian winemaking giant that produces Grange. Gago shrugs off the frenzy with characteristic Aussie understatement. South Australia had near perfect weather in 1998. And the result is a Grange that’s a massive concentration of blackberries, exotic spices, heady aromas -- “It’s almost too much,” says Jeremy Oliver, an Australian wine critic.

The style setters

It was Gago, the previous chief winemaker John Duval (who created the 1998 Grange) and eight other Penfolds winemakers who recently gathered in that bright white room at Penfolds headquarters in the Barossa Valley, the wine region two hours northeast of Adelaide.

“The classification,” as the annual selection of grape juice is called, is the formal process of determining which batches of fermented juice will go into Grange and which will be relegated to Penfolds’ second- and third-tier wines.

Since most of the company’s wines are blends, what distinguishes the dozens of Penfolds wines from one another besides the variety of grape is chiefly the quality of the grape, according to Gago. The better the grape, the better the wine ages.

“There is very little difference between how we make Grange and Koonunga Hill,” he says, almost daring an argument over why Grange can command hundreds of dollars while Koonunga Hill is served with pizza.

Grange has been coveted by collectors since Penfolds winemaker Max Schubert created the unique blend of prime South Australian fruit in 1951. But only recently has it become one of the hottest wines in the world. As is so often the case, U.S. wine critic Robert M. Parker Jr. sparked the fire. In the spring of 2001, he gave the 1998 Grange 99 points out of 100, calling it “absolute perfection.”

The 1998 Grange contains the highest alcohol level in the history of the wine -- 14.5% -- and reminds some critics of the California cult wines. “This Grange is dipping its toe in the California waters,” says Oliver, the Australian wine critic. Oliver believes the higher alcohol level is the result of changing growing techniques across Australia.

“They are picking riper fruit with a higher sugar content because they are trimming foliage, allowing better air and sun through the canopy,” he says.

Historically, Australian wine collectors have been the pillars of the Grange fan club. The hard-core members scramble to own bottles from each year. The rest of the world’s collectors have been respectful but less enthusiastic about the pick of the crop from a country they view as one of wine’s developing nations.

For example, the 1998 Grange sold out in one day in Australia. In the U.S., which gets 30% of the Grange production, some bottles may still be in wine stores -- in fact, a survey of L.A. area stores turned up several bottles of various vintages. Penfolds’ second-tier wines -- St. Henri, Bin 707, RWT and McGill Estate -- are available here in more limited quantities. They cost much less, starting at about $60 a bottle, and have a character similar to Grange.

Hoping that the current Grange fever might ignite the rest of the world’s interest in older vintages, Australian wine broker Heritage Fine Wines put a vertical flight of Grange magnums (1979 to 1997) up for auction on May 3 at Morrell Fine Wine Auctions in New York.

The auction was a disappointment, however. Even after Southcorp, the wine conglomerate which owns Penfolds, threw in a magnum of the 1998 at the last minute to extend the flight, the 18 bottles sold for $30,000, less than the $32,000 to $40,000 it was expected to fetch.

“Australian wines are still seen by Americans as value wines,” says Jung Soo Kim, a Morrell auction specialist. “Americans don’t know these wines yet.”

Grange is an acquired taste, Oliver says. “If you do the tastings over time, it does stack up with the best wine in the world. And it has a longer track record than any other Australian wine. But no one makes wine the way Grange is made. The consistency that makes it distinctive is also its Achilles’ heel.”

Tomorrow, Christie’s London house will auction more than 100 bottles of Grange, representing nearly every year of Grange production, including a bottle of the first vintage in 1951. That bottle alone is expected to sell for $20,000 to $25,000.

“It’s quite a lot to offer at once,” says Richard Brierly of Christie’s New York office. “We’ll see if private collectors are still enamored of Grange.”

A five-year wait

Gago won’t be able to boast a Grange vintage as his own until the 2003 bottles are released in 2008. Only the fourth Penfolds winemaker to shepherd Grange, this is his first year with the mantle.

Even then, Gago argues, the whole point of Grange is that each vintage is supposed to remind drinkers of every other vintage of Grange. The style and flavor profile of Grange were set in the 1950s, the early years of its development when Schubert first wondered: Why not create a wine blending the best fruit grown in Australia, the grapes from the oldest vines?

Gago sees himself more as the wine’s servant than its master. Schubert’s ghost dictates what Grange looks and tastes like. Every Penfolds winemaker has spent years training his taste buds to recognize Schubert’s idea of perfection: a seamless, full-bodied wine with impressive complexity.

Wine critics talk of chocolate, berries, dark black fruits, sweet leather flavors, musky spices and velvety smooth texture -- pretty much every word you can think of to describe a red wine, with the exception of austere.

“It’s about consistency, which is different from predictability,” Gago says, noting that each year of Grange reflects the weather across South Australia.

The historic Penfolds Magill Estate, on a hill overlooking the port of Adelaide, still is a functioning winery. But these days it also is a winemaking museum, with its ancient wax-lined fermenters and other odd winemaking paraphernalia dating to 1844, when Dr. Christopher Rawson Penfolds emigrated from England intent on relieving pain and suffering in the New World with his medicinal wine.

The solid Victorian-era stone buildings overlooking Australia’s agricultural port city of Adelaide mark the time when the country began producing wine in earnest.

Walking through the Penfolds winery’s underground storage rooms -- a series of round-ceilinged brick bins with dirt floors where Penfolds wines historically were bottle-aged -- Gago points to one. That’s where Schubert created a false wall behind which he hid the early Grange vintages from his bosses, the Penfolds family. The autocratic Australians hated his Grange experiments and ordered him to stop wasting his time and their money.

It wasn’t until 1960, after he made Grange surreptitiously in limited quantities for several years, that the family reversed itself and gave Schubert the resources to make Grange to his specifications.

There was little or no Cabernet Sauvignon in South Australia during Schubert’s time, so Grange was almost 100% Shiraz with a sprinkling of Cabernet. Today, says Gago, with more Cabernet available, Grange contains as much as 14% of that varietal, but usually no more than 5% Cabernet.

“We have a preset quality bar for Grange,” Gago says. “In the vineyard, we know what grapes we want, selecting the exact rows that will be candidates for Grange. There might be 100 different vineyard batches fermented in small vats that we’ll select from for Grange.”

Neville Kies, a fifth-generation Grange grower, heard two weeks later that the grapes from his 40-acre Barossa vineyard made the grade for Grange, the largest single batch to go into this vintage.

It’s welcome news. Penfolds pays about $6,700 per hectare for Grange fruit, versus $4,700 to $3,400 a hectare for grapes that make its second- and third-tier wines. It’s as much as anyone in Australia pays for grapes.

“There is pride in growing grapes for an icon,” he says with the solemnity of a preacher. Kies, 43, moved back to the family farm after his father had a stroke. He shrugs off the idea that he’s done something special with his vineyard. His vines are more than 100 years old. “If we don’t make it into Grange, it’s because Mother Nature turned and looked elsewhere,” Kies says. “We do what we do and if we do it right, good-on-ya. It’s all the place, Barossa.”

The Barossa Valley is to Australian wine what Napa is to California’s wine industry -- if you roll back the clock 30 years.

Barossa’s rolling hills are split between sheep and cow grazing and vineyards, many as old as the Kies’. In the fall, the valley is sleepy and slow. But a flourishing local food and wine culture attracts summer visitors to festivals and concerts. It’s a three-day drive from Sydney, but Melbourne is only half as far.

Settled by German pioneers in the mid-1800s, Barossa has changed little since then. Many pioneer families, like the Kies, still live on their original homesteads. They planted vines as one of their first crops.

The Kies’ home, like most of their neighbors’, is a small farm cottage with a touch of Victorian latticework accenting a round-edged corrugated iron roof.

The vineyards in the running for Grange are among the oldest in Australia, Gago says. “We need the small berries, thick skins and low yields that old vines offer.”

And you can be sure Gago and the committee hope they’ve found the right ones for 2003. There’s a lot to live up to.