Australian slang: cheap wine, port, sherry or other fortified wine products. really, really cheap, and usually rough :)
the word is a corruption of the 'flagon' (very large glass bottle) such products were/are sold in. although you'd usually buy it in casks these days, flagons still exist especially for port and sherry.
arrrgh, mate, that goon we got our hands on last night really did some damage...