Seppeltsfield MD Warren Randall has revealed his multi-million dollar plans to conquer the Chinese market and become one of the biggest players in the Australian wine industry.
Randall told Max Allen at the Australian Financial Review that “to really make money in any agribusiness you need to be able to read the cycles. You need to read them first and then to ride them. And now we are at the beginning of the most significant cycle this industry has ever seen, thanks to China.”
“China is 24% of Australia’s export market,” he added. “It’s number one. And Seppeltsfield is ready to ride that cycle.”
Randall believes one of Seppeltsfield’s key advantages is the winery’s 167-year heritage in South Australia, which spurred his decision to buy the Seppeltsfield trademark back from Treasury Wine Estates earlier this year, in addition to purchasing the Ryecroft winery and 40 hectares of vineyards in McLaren Vale and the Quelltaler winery and 365 hectares of vineyards in the Clare Valley.
The company is now working on restoring all the properties.
Allen notes that Seppeltsfield has so far spent $6.5 million on what Randall calls “adaptive re-use” of the historic Seppeltsfield site, with another $6 million slated for further redevelopment.
Ryecroft was established in 1888 and Quelltaler in the 1860s. He intends to restore them in the same way he’s done with Seppeltsfield.
“There’s something very therapeutic about acquiring historic wine properties and their brands and resurrecting them,” he said. “Especially when you’ve got a premium bulk wine supply model behind you – because that generates cash and then you have fun with the cash. Rather than pull it out in shareholder repayments or just buy nice cars and houses, it’s fantastic to do something like this.”
He believes the history of the properties will be a drawcard for Chinese tourism in the region.
‘We’re looking to attract Chinese tourism to the Barossa Valley,” he explained. “We know that when Chinese visit they are very impressed. What we’re doing is genuine. It’s real. You can touch it. They understand the importance of history and heritage.”
Also pivotal to the company’s plans is the joint venture it has with Minquan Jiuding Wine Company in China’s Henan province. The venture is reported to be worth $75 million and financed by NAB, who, Randall says, are “literally banking on my success” and the hugely successful premium bulk wine business model he has built up over the last 24 years.
The “chateau” will sell both Chinese labels and Seppeltsfield wines, while Seppeltsfield will also provide bulk wine to be bottled in a joint brand, and also for separately marketed Minquan Jiuding wines.
“The chateau will be our platform to attract Chinese tourists to Seppeltsfield and the Barossa,” Randall told The Adelaide Advertiser. “This is also about having some vision and being opportunistic. I want a presence and I want a location.”