Australia’s “Two Buck Chuck”

Posted by Tom Wark on Jul 22, 2006

The oversupply woes that have hit Australia’s wine market over the past couple of years appear to have generated a wine that many in America will recognize.

The Aussies are referring to a wine that hit the shelves there at a price of $1.99AU as "Two Buck Chuck" in reference to the Charles Shaw wine of the same American dollar price that Trader Joes sells and which is made by the Franzia family.

The Australian wine industry doesn’t like this turn of events:

"Wine Grape Growers’ Association executive director Mark McKenzie
said there was no way wine could be sold economically at such low
prices, and fire-sales would hurt the industry in the long run if
consumers came to regard such prices as normal.

"Other popular branded premium products at $10 or less would
certainly be under pressure if consumers feel the quality of the wine
is reasonably comparable," he said.

I suspect the wine could be sold economically if the producer got the grapes or juice cheap enough and made enough of it to allow the very small margins to accumulate.

However, just like in America, there just isn’t enough Two Buck Aussie Chuck in that country to convince drinkers that this is the price at which most wine ought to be sold. That said, it appears there will be time and restructuring to rid Australia of the lake of wine that exists there.