Have you ever wondered about wine economics–what are the costs of a bottle of wine? While the industry, made up mostly of private companies, often keeps margins shrouded in mystery, I spoke with one vintner who broke down the price of barrels, corks, grapes as well as the three tiers for me. And since that vintner was Bo Barrett of Chateau Montelena and Barrett & Barrett, he offers perspective on a range of (higher-end) wines. I also dig up some info on lower-end wines.
Margins are something that always pique the interest of consumers. So check out the piece over on wine-searcher.com and let us know your thoughts.
While the story of the stylistic shift in California winemaking (dubbed, inter alia, the “New California”) is arguably the most exciting story in American wine in the last decade, one aspect has been a stumbling block: price. Particularly as it relates to lower-priced, highly drinkable wines, known variously as vin de soif or glou glou wines. It’s something we’ve discussed, oh, here, here, here, and here previously.
So I was glad to see Wine & Spirits taking up the topic in their June issue. Their piece points to the price of grapes as the main obstacle, saying that at $1,000/ton, it’s possible to make a $20/bottle wine but $2,000/ton is “pushing it.” This has pushed the glou glou producers to far-flung parts of California and to pursue less premium varieties that are still refreshing.
Given that a wine that sells for 2 euros at a small domaine could easily sell for $10 here after all the markups, another way to make domestic glou glou production more financially viable would be to sell directly to consumers. Alas, given the three-tier system, that would reduce it to in-state sales. But even if drinking a glou glou wine were only an option locally in California? There’s still a lot to be said for that.
A Napa vintner hired a consulting enologist to cook him up a “cult” wine. It didn’t work out, the wine got flushed and the vintner is now suing the wine consultant to the tune of $1.6 million. See the Napa Valley Register for more details.
Who was that who said “I pity the fool who chases points”? Confucius? Mr. T?
The rain in California falls mostly in the winter. I think that’s how it went in Pygmalion. At any rate, the rain has decidedly NOT been falling this off-season for the vines. While that doesn’t necessarily spell doom for California’s wine industry–some older vines have deep roots–it does mean less water to go around and and a descent into the politics of water scarcity. New vines and a lot of older vines in the Golden State rely on drip irrigation–it will be interesting if “dry farming,” which some claim produces wines that are more expressive of their terroirs then irrigated vines, catches on this season out of necessity. Also affected are increasingly popular “cover crops,” the nitrogen-rich plants that some vineyard managers sow between the vines to plow under and provide natural fertilization for the soil.
Jason Haas (right), of Tablas Creek in Paso Robles, one of the hardest hit areas in the state, told Bloomberg News that competition from overseas will limit how much California producers can pass drought costs on to consumers. Aquifers and wells may cover some of the shortfall, but, again, welcome to water politics, perhaps a dominant theme for this century in much of the country.
California produces 89% of American wine. The San Joaquin Valley alone cranks out 60%. The Central Valley also produces many of the country’s fruit, nuts and vegetables–America’s salad bowl, if you will, rather than its breadbasket. Mather Jones has a terrific infographic on how the California drought could affect you no matter where you live. (Btw, since it takes about 600 to 800 grapes to make a bottle of wine, they therefore claim it takes 180 – 240 gallons of water to make a bottle of wine. Vintners, winemakers: does that strike you as an exaggeration?)
On a somewhat optimistic note, rain is on the way. Randall Grahm, who makes his Bonny Doon wines on and around California’s central coast, tweeted today: “The fact that rain (and lots of it) is forecast for later this week is the best thing I’ve read in forever. #betterthan95ptsfromparker” Read more…
SIPPED: Jancis Robinson argues in favor of the “classics” over wines from obscure grapes just for the sense of obscurity. Twitter fight ensues.
SPIT: the legislative efforts to mandate warehousing wine in NY for 24 hours prior to end delivery have regained some momentum, unfortunately. The NY Post argues it would add $2 to a bottle of wine. Some distributors and producers have bonded together so create a web site where NY consumers can send their legislators a note of protest. #stopthecorktax
Game time: see if you can correctly identify the photo of an official state wine cellar with the correct country, US, UK, and France.
Okay, okay, it’s photographic hyperbole — but the White House really doesn’t have a wine cellar to speak of. Downing Street (top) buys the wines on release and stores them for official occasions. Buckingham Palace has some terrific wines too as you may recall that when Obama went there on a state visit, the Queen uncorked some DRC and ’63 port. The Elysée Palace (middle) has an impressive cellar, as you might expect. The White House, by contrast, procures wines for state functions on-demand so rarely serves wines with much age on them.
The relative paucity of the White House wine cellar has its roots in our country’s love/hate relationship with alcohol: loved it so much that it became a political issue leading to Prohibition. While the shadow of Prohibition looms over the industry in the form of restrictions interstate shipments (among other things), the fact is that Americans are into wine now, as witnessed by instagram feeds or the fact that per capita consumption has increased for 20 consecutive years. So a big chunk of America would probably take pride in having some decent American wines slumbering in the White House basement.
How likely is that to happen? When pigs fly. The UK and France have both reduced their wine collections recently in the name of austerity. China introduced a ban on expensive alcohol at state banquets in the last quarter of 2011. And with an economy that’s not exactly firing on all cylinders here, there’s no way the White House would engender criticism for that kind of expenditure. Still, an American wine lover can but dream. Maybe, as a matter of national pride, Bill Koch could endow the White House with a starter collection of well-vetted wines from his cellar? Read more…
The SF Chronicle has a piece on the next generation of Napa Valley vintners. Here’s a snippet of what they’re up to:
Young, ambitious and eco-friendly, with hobbies like deer hunting and Porsche racing, the next generation of California’s wine heirs is coming of age…
Ah, yes, eco-friendly Porsche racing! Funny, with this lot, you think they’d be Scions. Anyway, there’s more:
[Loren] Trefethen had been watching TED talks and attending Summit Series events, invite-only weekend escapes at a private ski resort, and he decided to host his own event series. The Trefethen Table, as he calls it, is a dinner series curated by Trefethen and Hebb. Guests – like Gary Friedman, the CEO of Restoration Hardware, and Ido Leffler, the founder of SayYes – sit around an enormous tabletop and discuss previously arranged topics, like the art of conversation, the ocean, health and “the paradox of density.”
And now he wants to make a reality TV show out of these talks.
Janet Viader: “We get together once a month, and there’s some laughing and joking. Every now and then it’s a bitch-fest about working with family.”
“Alex Kongsgaard works for his family’s winery and on the side makes a line of wines he calls Skeletons vs. Robots (an Albarino and a Zinfandel). He draws the labels himself with a Sharpie.”
“Will Harlan came home to Napa after trying his hand at a price comparison startup. In October, he debuted Mascot, a cheaper version of his family’s high-end wine (Harlan wines can go for $750 to wine club members; the Mascot costs $75).”
So much win! Check out the full article for an inside look at this rare breed.