'There's no over-supply problem' in New Zealand - Dining and Cooking

In part one of a revealing interview, Andrew Donaldson, founder and owner of Central Otago producer Akitu, tells Sarah Neish why, if anything, New Zealand may have an issue with “under supply” in the coming years due to soaring demand in the US.

Lake Wanaka, Otago

When I met up with Andrew Donaldson, owner of Central Otago producer Akitu, he had flown to London from New Zealand’s South Island to showcase the latest vintages of the winery’s A1 and A2 expressions (2024 and 2023, respectively). Both are premium single-varietal Pinot Noirs, both priced under £45, and both reflective of their capricious but special vineyard site nestled up against the Southern Alps at 380m altitude.

Because of this location, Donaldson describes A1 and A2 as ‘Alpine wines’, but he pointed out that Central Otago’s Southern Alps differ dramatically from, say, the French or Swiss Alps, as “our mountain range is a spine that separates an island, rather than a massif [large group of connected mountains].”

Rarely confused

Much like the spear of acid running through its wines – “the thing that defines great Pinot Noir is acid”, Donaldson told me conspiratorially – Akitu is a streamlined operation, producing only three wines. There is the flagship A1, a second wine, A2, and an experimental Pinot Noir Blanc, which Donaldson explained was an attempt to “show that we are racy, edgy, innovative and that we wanted to evolve.”

Does having such a tightly focused portfolio help or hinder during economically tough times?

“It helps massively in terms of focus and expectation management. We are rarely confused in what we are doing,” Donaldson said. “From a consumer perspective, it all makes perfect sense, it’s never befuddled. Three wines, three distinct purposes. I find it hard enough to select wines from different vintages, let alone the annual distinctions between this block verses that one. Why make things harder?”

He describes the 2024 vintage of A1 as being “ripe, rich and voluptuous”, adding that “you could no way describe this as ‘light’” in the way that some people tend to paint a picture of Pinots. Admittedly, he said, some wines made from the variety can be “lean like a cyclist, all bone and sinew, but you don’t really want to go to bed with them. I love the sexiness of Pinot Noir.”

Revelations

Last year’s releases represented a significant milestone for Akitu, with the 2022 vintage marking 20 years in the ground for its Pinot. Twenty years, Donaldson told the drinks business, “is just the end of adolescence for those vines. Now we find out what sort of beings these 38,500 vines actually are.”

Those revelations are already coming thick and fast, with the winery owner revealing “we should probably replant one of the six clones, our 114 has rarely performed close to its potential. Our fault, wrong place.”

Donaldson, who acquired the 12ha plot in Wanaka, one of the six key sub-regions of Central Otago, in 2000, has seen the wine industry and consumer tastes change considerably since then.

“Young people don’t want heavy tannins and increasingly expensive Bordeaux,” he said. “They don’t want weight. They want freshness and lower alcohol, they want fruit and taste.”

All of which, Central Otago Pinot Noir delivers in spades. So why is there not more of it on UK shelves?

Marketing dilemma

At the time of writing, Waitrose Cellar features 27 New Zealand Sauvignon Blanc wines ranging from £7.90 to £26.50, but just seven New Zealand Pinot Noirs (only two of which are from Central Otago).

Over at Majestic, it’s a similar story, with 38 New Zealand Sauvignon Blancs listed compared with 15 New Zealand Pinot Noirs, just four of which hail from Central Otago.

“It’s not the retailer’s fault, Donaldson told db. “It’s our fault as producers, and as distributors.”

Diving into the mathematics of the equation he said: “If you look at the total worldwide supply of wine, New Zealand produces 1% of that. Sauvignon Blanc represents somewhere close to 85% of New Zealand’s exports, leaving .15% of the total world’s supply for NZ’s other varieties.

“Half of this,” he continued, “is New Zealand’s second largest crop, Pinot Noir (making up about .075% of the world’s wine supply).”

And if you zero in further still, “half of that Pinot Noir comes from Central Otago. It means that, very roughly, Central Otago Pinot Noir makes up about .0375% of the world’s wine supply, spread amongst, lets say 80 producers. Therefore, getting presence in international markets takes a big investment. You’ve got to have a really good strategy.”

However, he noted: “I don’t think enough energy has been put into marketing New Zealand’s Pinot Noir or its Chardonnay, simply because the world chose Sauvignon Blanc.”

Unless you are one of the few wineries that is a massive marketing machine, then “all the rest of us are in a meat grinder, and out of that will come some steak tartare, and some dog food,” he joked.

That said, if everything “works out correctly”, Donaldson added, then “the Pinot Noir/ Chardonnay parallel story will evolve beautifully, and balance the misconception that New Zealand’s only wine story is Sauvignon Blanc.”

Oversupply Vs undersupply

Back in June, one UK distributor told db he thinks we will “begin to see the economics unravel” in New Zealand’s wine industry “from this vintage”, due to many producers reportedly grappling with an oversupply.

Donaldson is flummoxed by this, saying that if anything New Zealand should have “an allocation problem rather than a production problem.”

“As I understand it, if the growth rates for Sauvignon Blanc in the US continues on the path it’s going then there is no problem with over-supply,” he said. “In fact, there may be a problem with under-supply.”

According to Donaldson “the US has now got New Zealand Sauvignon Blanc well and and truly between its teeth, and if we play it right then we can use that to educate consumers about other varieties from New Zealand, like Pinot Noir and Chardonnay.”

“Blunt club” of tariffs

However, US tariffs remain a significant hurdle for wine producers across the globe, with a recent report showing that in the last six months the US saw a 16.8% slide in the volume of wines imported into the United States, and a 25.2% slump in value compared with the first six months of 2025.

“Dealing with state-run monopolies anywhere in the world is like hip surgery without anaesthesia,” said Donaldson. “There are good reasons to ‘tax’ alcohol, be that on importation and/or consumption. I get that, but the blunt club of tariffs is a thug’s cudgel – it’s imprecise, protectionary, and anyway, it just taxes domestic consumers.”

He continued: “I read a fabulous interview with a winemaker from Napa who asked the question of where did the US government think his bottles, corks, capsules, labels, oak casks and winery machinery all came from? The answer? All imported, all tariffed. It’s just inflationary.”

Far from naive

Donaldson is also far from naive to the fact that his perspective on a potential oversupply/undersupply of New Zealand wine is that of a premium, small-batch producer as opposed to a bulk operator.

“I run a vineyard of 12ha, getting 5.4 tonnes per hectare of premium to super premium Pinot Noir. In extraordinary years I might get up to six tonnes per hectare,” he said. “Everything we do is done by hand. Bud thinning, shoot thinning, crop management, picking, all done by hand.”

On the other hand, “a Sauvignon Blanc vineyard, even a premium one, might be getting 12-16 tonnes per hectare, so a lot of what they do is mechanised. It means they can chuck out a bottle of Sauvignon Blanc and still make a decent margin. We [Akitu] can’t produce in that space. But do I have any interest in producing anything less than the very best I can produce? None at all. ”

Getting better with age

The only way that Central Otago can be cushioned from these sorts of economic pressures “would be if the world’s wine buyers become increasingly comfortable with the premium that is required on our best output to justify the prices we need to charge to be sustainably profitable,” Donaldson said.

“There are of course opportunities for the wine industry in our region to optimise – that’s a given, but Central Otago Pinots are only getting better and better as vines age. There are some amazing vineyards and very clever winemakers working in our region – and there’s another variety evolving fast too, Chardonnay…

“Is this the best place in the new world to grow and make methode traditionelle?”

Climate control

This year, Central Otago saw a particularly tricky harvest, both long and late, with Donald van der Westhuizen, chair of the Central Otago Winegrowers Association, saying that “summer never really arrived” in the region. Donaldson agrees that “it didn’t get hot enough this year”, but said happily that Akitu’s 2026 vintage has “produced magnificent fruit.”

“We’ve always got frost,” he said. “Frost, for us, is just a risk to be mitigated.”

But despite summing up winegrowing as being “a treacherous, very, very difficult business right now”, that’s not to say, Donaldson added, that “out of that darkness can’t come a more conducive scenario”. One in which impressive wines such as Akitu’s A1 and A2 end up on the right people’s radar, hopefully helping to dismantle the “slightly distorted view” of New Zealand’s wine offering being all about Sauvignon Blanc.