Syrah or Shiraz, what does it mean for price?

Syrah and Shiraz are made from the same variety of grapes but what you call the wine on the label has a big impact on the price, according to research by Charles Sturt University (CSU).

Professor of Applied Economics and Quantitative Methods, Eddie Oczkowski, from the National Wine and Grape Industry Centre (NWGIC) and CSU School of Accounting and Finance, has examined the strategic use of synonyms for varietal names in wine labelling.

“Legislation governs the type of information that can be used in naming a wine in Australia,” Professor Oczkowski said.

“In some cases producers can strategically choose the grape variety name that appears on the label, for example Syrah is an acceptable synonym for Shiraz, Sauvignon Blanc is an alternative to Fume Blanc, and Pinot Grigio can be used for Pinot Gris.”

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Professor Oczkowski said the research examined if there are price premiums associated with these alternate names.

“We examined wines sampled in James Halliday’s Australian Wine Companion from 2011 to 2016 using a model that controlled for the other factors that may influence price, such as quality, grape region and cellaring potential,” Professor Oczkowski said.

“We found that Syrah commands a premium of 27 per cent compared to Shiraz, Pinot Gris has a premium of 14 per cent compared to Pinot Grigio, and prices for Fume Blanc were 9 per cent higher than Sauvignon Blanc.

“There is an expectation amongst winemakers and some consumers that there are stylistic differences between the alternate names. However there’s evidence in blind tastings to suggest that these differences may not always be apparent.”

Professor Oczkowski said the research indicates that there is a potential for a small number of producers to capitalise on these premiums by using an alternate name.

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“If there was a big shift in the industry towards labelling the wine as Syrah rather than Shiraz for example, we would expect the current premiums to be eroded.

“The research findings also suggest that consumers may need to think twice about purchasing some of these varieties which use these alternative names. In some cases, there is little point in paying a higher price for a wine if there is no demonstrable difference of what’s inside the bottle.”

Professor Oczkowski’s research is published in the International Journal of Wine Business Research.

The NWGIC is an alliance between CSU, the NSW Department of Primary Industries (DPI) and the NSW Wine Industry Association.

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