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Climate change signals the end of Australian shiraz as we know it

By Jane Wardell

HOBART Tasmania (Reuters) - Young Australian vintner Nick Glaetzer's winemaking-steeped family thought he was crazy when he abandoned the Barossa Valley - the hot, dry region that is home to the country's world-famous big, brassy shiraz.

Trampling over the family's century-old grape-growing roots on the Australian mainland, Glaetzer headed south to the island state of Tasmania to strike out on his own and prove to the naysayers there was a successful future in cooler climate wines.

Just five years later, Glaetzer made history when his Glaetzer-Dixon Mon Pere Shiraz won a major national award - the first time judges had handed the coveted trophy to a shiraz made south of the Bass Strait separating Tasmania from the Australian mainland.

Glaetzer's gamble embodies a major shift in Australia's wine-growing industry as it responds to climate change.

A study by the U.S. Proceedings of the National Academy of Sciences found that up to 73 percent of Australian land currently used for viticulture could become unsuitable by 2050.

As the country's traditional wine growing regions including the Barossa, the Hunter Valley and Margaret River grow ever hotter and drier, winemakers are rushing to the tiny island state of Tasmania. Average summer temperatures there are currently about 38 percent cooler than in the Barossa.

Temperatures in Australia's main wine regions are projected to increase by between 0.3 and 1.7 degrees celsius by 2030, according to the CSIRO, Australia's national science agency.

The hotter temperatures would reduce grape quality by 12 to 57 percent, the agency's modeling shows. But in cooler Tasmania, warmer weather could be a benefit because current temperatures can get too chilly for some grape varieties.

Wine makers are so concerned about the impact of global warming on the A$5.7 billion ($5.3 billion) industry that they funded a government-backed experiment in the Barossa vineyards to simulate the drier conditions expected in 30-50 years' time.

For wine lovers, the upshot is that Australia's iconic shiraz is already changing - Glaetzer's version is 15-20 percent lower in alcohol content than its Barossa cousins - and could be unrecognizable in half a century's time.

"If the projections are right, a shiraz in the Barossa in 50 years' time may well taste totally different to what it does at the moment," said Michael McCarthy, the government scientist heading up the Barossa experiment.

HOT, DRY AND EXPENSIVE

The flight south comes as Australia's wine industry emerges from a disastrous few decades, blighted by a high Australian dollar and a lengthy grape glut that saw exports plummet.

While the national wine industry has shrunk 1.9 percent annually from 2009 to 2014, the Tasmanian state industry is growing at a rate of close to 10 percent per annum, according to the Tasmanian Climate Change Office.

"We are investing increasingly in Tasmania ... because it's one of the cooler areas in Australia to grow grapes and if we are going to have climate change, you might as well start in a cooler climate," said Cecil Camilleri, the manager of sustainable wine programs at Yalumba, the 165-year-old winemaking company that has snapped up three Tasmanian properties in the past 15 years.

The average temperature in the Tamar Valley in the northeast of the state is around 17 degrees celsius (63 degrees Fahrenheit), peaking at 22 degrees in the summer - well below the Barossa's typical summer spike into the upper 30s.

Treasury Wine Estates , the world's No.2 wine company, last year purchased Tasmania's White Hills vineyard. The move was a geographical hedge as well as part of its strategy of owning or controlling vineyards that supply grapes suited to its luxury wine portfolio.

The company has sold its vineyards in the Hunter Valley north of Sydney where the world-famous Lindemans brand originated, citing its concern that the region will become "hot and dry and expensive."

BAROSSA BATTLERS

Barossa winemakers, meanwhile, aren't sitting back waiting for their vines to wither.

Yalumba is enforcing a change in the irrigation technology used by its growers from broadacre systems, which provide water to large swathes of land, to microsystems, which target specific areas, ensuring each drop of water counts. It is also encouraging growers to use graftlings, wine varietals that are grafted on to rootstocks, that have drought resistance as one of their characteristics.

"There's a lot of season-to-season adaption happening right now, because climate change is happening now," said Yalumba's Camilleri. "It's happening incrementally and we are adapting incrementally."

The government-backed "winter drought project", throwing tarpaulins over rows of vines, is designed to simulate reduced rainfall of between 15 and 20 percent that the region is projected to experience in 2030-50.

"If less winter rainfall has the impact we hope to demonstrate in this experiment, that's going to have some pretty major ramifications for the whole of the Australian industry in terms of yield, productivity and maintenance of productivity," said McCarthy, lead researcher at the South Australian Research and Development Institute (SARDI).

The group is investigating whether drip irrigation, which wets only a small portion of the vine rootzone, will be enough to supplement natural rainfall, which wets the entire rootzone.

Adding to vintners' woes, the rise in temperatures means a greater proportion of fruit is ripening in a shorter time window, resulting in a compressed harvest period that is putting pressure on vineyard facilities and management.

Treasury Wine Estates' national viticulturalist Paul Petrie said his company was looking for ways to "put harvests back into a more reasonable timeframe."

'NOT A NEW THING'

Not everyone shares the concern. Australia's current Conservative-led coalition government is playing down the role of climate change on Australian agriculture.

Since taking leadership of the country last September, Prime Minister Tony Abbott, who in 2009 said the science behind climate change was "crap", has abolished the independent Climate Commission, the body created by the former Labor government to provide public information on the effects of global warming.

Abbott has also introduced legislation into parliament to axe Labor's Climate Change Authority, which advises the government on emissions-reduction targets, and to repeal its tax on carbon pricing.

Abbott dismissed climate change as a factor when unveiling a A$320 million short-term drought relief package for farmers earlier this year: "If you look at the records of Australian agriculture going back 150 years, there have always been good times and bad, tough and lush times. This is not a new thing in Australia."

The Climate Commission had warned in its 2011 Critical Decade report that wine grapes and other temperature-and water-sensitive crops needed to adapt to climate change "or move to locations where growing conditions are more amenable to their production."

($1 = 1.0680 Australian Dollars)

(Editing by Emily Kaiser)

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