Mr. Big Thinks Small

Martin Gillam - November 2008

Developing small batch wines with new grapes, a venerable large Australian producer has set out to satisfy a modern demand for new styles.

"We want to be the world's largest boutique winery," says Peter Gago, smiling at the contradiction. After all, "boutique" is not a word that readily attaches to a brand as big as Penfolds, which makes over two million cases annually as part of the Australian conglomerate Foster's Group. But Gago, Penfolds' chief winemaker, insists that he's "only half joking," with good reason. As well as overseeing the making of the higher volume ranges known around the world, Gago and his team are creating a new microline of handmade wines in quantities miniscule enough to please the most obscure "garagiste."

Penfolds has built its reputation as masters of Australia's two stalwart red varietals, Shiraz and Cabernet, using them singly or in blends to make everything from the value label Koonunga Hill right up to the iconic flagship wines like Grange and St. Henri (both Shiraz) and Bin 707 (Cabernet Sauvignon).

But change is afoot at Australia's most traditional winery. While the great established labels will continue to hold pride of place, increasingly they'll be surrounded by a host of new siblings with names like Sangiovese, Pinot Noir, and Tempranillo. "Wine lovers in Australia and elsewhere are looking for new styles and different tastes," explains Gago. "We want to offer them that choice."

Under the Cellar Reserve label the Penfolds team is handcrafting small experimental batches of striking new wines. The project has been bubbling away behind the scenes for years, with new plantings and trial bottlings. The first commercial release was a 1997 Adelaide Hills Pinot Noir, Penfolds' debut with a grape that often struggles in the Australian heat. The next year they followed up with their first Sangiovese, from the Barossa Valley--and breathed a sigh of relief when both wines were well received by Australians and Europeans alike.

"When [Austrian glassmaker] George Riedel recently visited the winery, he requested that '97 Pinot with his lunch," says Gago, "even though he could have had Grange."

Other Cellar Reserve commercial releases so far include Grenache, Gewürztraminer, and Sauvignon Blanc, but each varietal is released only in years where the fruit quality warrants. More varietals are in the wings--Penfolds is running trials of Tempranillo, Dolcetto, Barbera, and Nebbiolo. The Italian and Spanish varietals seem to be a natural fit in the Australian landscape, whose rolling sunbaked hills would not look out of place in Tuscany or the Rioja.

Gago believes Tempranillo is particularly well suited. "When I visited Ribero del Duero in Spain, the distant landscape at night looked like sand dunes, but it was just the reflection of the moonlight on limestone in very dry vineyards. There are many areas in South Australia with a very similar climate. There's a real potential for the southern European grapes here."

Penfolds is not the only producer who thinks so. Australian winegrowers in nearly all the main regions have begun planting newer varietals (new to Australia, anyway), and there's even an annual Australian Alternative Varieties Wine Show. It attracts more than 500 entries, ranging from the better known grapes like San­­giovese to exotics like Tscharke, Arneis, Aglianico, and Tannat.

Gago says that in adopting a new slate of varietals from the Old World, the Penfolds team has also adopted some of the centuries-old European methods for handling them. "For us these are really handmade wines, very labor intensive and the ‘purest' we make. For example, with the Sangiovese, there's no added yeast, no pH correction, no new oak, no blending, no fining, no filtration, no blending with another varietal. Literally the only thing in the bottle other than crushed and fermented Sangiovese grapes is a small and necessary addition of SO2--an antioxidant and antimicrobial agent used in winemaking since Roman times.

"We had an Italian winemaker join us for the 2000 vintage at Magill Estate, and following his advice we now leave Sangiovese on its skins for up to five weeks following fermentation, something that was quite alien to the way we were used to making the wine ourselves. So now we're making wine in many different ways, and it's really broadened our outlook."

Then again, innovation is nothing new for Penfolds. Although it's one of Australia's most historic wineries (founded in 1844), its cellars have long doubled as vinous laboratories. Its famous Grange Shiraz is the product of a radical experiment in the 1950s by then chief winemaker Max Schubert, who defied management's order to cease production and kept making it in secret until the market gave him thunderous vindication. Other one-off "Special Bin" wines made by Schubert and his successors are the stuff of legend--Penfolds 1962 Cabernet-Shiraz Coonawarra–Barossa Valley Bin 60A has been named as one of the world's top 10 wines "to drink before you die" in the British press.

The Cellar Reserve wines follow in that spirit. Fittingly, they're made at Penfolds' original Magill Estate winery in Adelaide, in the same open fermenters that Schubert used to make the early Granges. "The small scale at Magill means we can keep these wines separate from the mainstream wines we make at our Nuriootpa winery in the Barossa," says senior red winemaker Steve Lienert. "Magill is like a stand–alone boutique. It's where Max experimented, so it's like coming home."

"And remember," Gago is quick to add, "our top wines, like Grange and Bin 707, are crafted in small quantities too. That's why the goal of ‘world's biggest boutique' is only a half-joke."

There's not much of the Cellar Reserve wines to go around. A total of only a few thousand cases was made in 2007, but some of them are being exported. The Pinot Noir comes to the United States (though not yet the Sangiovese, which goes to Europe). "Because of the small quantities, we're generally offering them to restaurants," says Gago. "Restaurants like them because they can offer their customers wines that are difficult to find anywhere else.

"These new styles have been well received as wines that pay homage to the original benchmarks like Brunello or Chianti, while still having a definite Australian stamp to them. Australia has to be careful not to become known only for Shiraz," says the maker of the country's best known Shiraz. "A few years back it was just about only Australia and the Rhône for Shiraz, but now it's being grown in California, Italy, South Africa, South America, and so on. It's good for us as a company, and as a country, to broaden our base."