With the off-year election over I only need to say a couple of things: 1) Thank God I was smart enough to stay out of the fray, and 2) I need to apologize to the county’s voters for not giving them as much credit as they deserve. I would have sworn that Measure M, the anti-GMO initiative, was gonna pass, what with the West County mentality, but it did not. That means science is still alive and well with thinking Americans. Thanks to all of you who are really concerned about the future. I think the failure of Measure M is even worth a toast—let’s all have a big glass of Sonoma or Napa wine to congratulate ourselves. (Red, of course!)Well, the harvest is finally over, and the winter rains have started, so a quick review of this year’s harvest seems in order. With all of the supposed marketing expertise available within and without our industry, how did we get caught with our pants down again? Everyone says the fruit is wonderful and will make wonderful wine—the wine of the century, one winemaker said. If that is the case, how come we dumped a few hundred tons of sound fruit on the ground? With the great crystal ball that we think we have, how come wineries did not add tanks and barrels to meet this great need? If wineries were so sure that wine consumption is skyrocketing, why weren’t we prepared? Guess we didn’t get much out of those $500 per day seminars—although we did manage to put thousands of dollars into the organizers’ pockets.
Anyway, this year’s harvest was one of those good news/bad news things. The bad news is that we were not able to sell all of our fruit and had to dump some on the ground. The good news is that every grower sold all the grapes he “thought” he had, and the stuff on the ground would have been only more gravy on top of a very good year. I wonder if the pickers got a bonus? Just thought I would ask.
With the large supply of high quality fruit available this year, and if supply and demand really have any effect on the wine industry, we should expect some great wines available at prices even we working people can afford. I’ll keep my fingers crossed, but I won’t hold my breath.
Nevertheless, I am happy to say that we are making headway in making wine more accessible—in packaging if not in price. Lacking the frightening cork removal procedure, the “bag-in-the-box” (from hereon referred to as a “cask”) is the single fastest-growing segment in the industry. The extreme convenience for our fast-paced working couples could be a big factor. To quote Bay Area wine consultant Jon Fredriksen, “Once it is open, it is so easy to draw a glass of wine.” Need there be another reason? Plus it is amazing how often it gets empty. Maybe we are increasing our consumption a little bit at a time. We are a convenience-oriented society, as you know. Unfortunately, the wine mystifiers are still at work. In the same article about cask wines, a liquor store manager was quoted as saying, “I understand you’re to pour a glass of red casked wine and let it breathe from the glass. Of course, the proper glass is required!” Hopefully this was a tongue-in-cheek comment, but it was portrayed as real. It was also stated that the size of the mouth of the glass is very important as it allows the wine to hit the tongue in different ways. My God! With comments like that, no wonder we have Connie and Conrad Consumer scared off! My friends and I have been known to use Styrofoam, plastic or paper cups and perhaps even a straw when needed. But, of course, we drive dirty white pick-ups instead of Lexuses, also.
Other encouraging figures about the casks are that dollar volume of three-liter casks (selling for $16+) is increasing nine times faster than the overall wine category. It is interesting to note that most of the increase was coming from wine consumers increasing their purchases, and a much smaller percentage was coming from new wine consumers. The most popular varieties are Pinot Grigio, Cabernet Sauvignon and Syrah/Shiraz. Blush and generic whites (excluding Chardonnay, though it’s become very generic, indeed) are showing declines. It is also interesting to note that new brand entrants are getting most of the growth.
Remember that much vaunted Gallup poll about how wine was becoming more popular than beer. I was just as thrilled as everyone else in the industry to read that, but then I got to thinking and just couldn’t resist digging a little deeper. According to that Gallup poll, wine consumption in the U.S. is at an all-time high and that in July 2005, wine passed beer as the beverage of choice by U.S. adults. Sounds good, right? Here’s the problem—Americans still drink about 10 times as much beer as wine. Turns out, that Gallup Poll was an opinion poll. It wasn’t based on hard numbers sales data. Beer consumption is indeed declining—down to 21.6 gallons per person in 2004 from 27.1 gallons per person in 2000. But with wine at just over two gallons per person, we have a long way to go to equal that. Just as with wine, however, it is interesting to note that 10 percent of the beer drinkers drank 43 percent of the beer. Raiders fans must surely be in those numbers while 49er fans are in charge of Chardonnay consumption. Here’s another comparison between the two industries. Despite the proliferation of boutique beer brands, three big companies (Anheuser-Busch (51.9%), Miller Brewing (18.7%) and Coors brewing (11.3%) sell 81.9% of all domestic beer. Sound like any other industry you know of? Yep. The wine industry, where the top three companies—E.&J. Gallo, Constellation Brands and The Wine Group—produce more wine individually than most of the other 30 top-selling wine producers added together, according to Wine Business Monthly.
In closing, it is interesting to note that the lovely little hamlet of Healdsburg is developing a problem—according to the local city council anyway—and that problem is…what’s your guess? Drugs? Crime? Ridiculously expensive restaurants? Nope. Too many tasting rooms in the downtown area. I, as usual, look at this in a couple of different ways. First, I remember when the attraction of the tasting rooms was the presence of the vineyards, country setting and overall ambiance. What happened to that scenario? The complaint in Napa used to be that the tasting rooms along Hwy. 29 were too many and too close together, so close that you drive from one to the other in less than five minutes (that is if you could get out on the highway in the first place). Now, in Healdsburg, you can walk from one to the other in less than a minute—unless it’s your sixth tasting room of the morning and you need crawling time. Downtown Healdsburg is becoming nothing but a tourist mecca, and it is tough for locals to find a meal they can afford or a pair of underwear if you need it. Rents in the downtown area are exorbitant, and it appears that tasting rooms and restaurants are the only ones that can afford them. Perhaps a better question is, what does that have to say about the profitability of tasting rooms? Gee, they’re only making 100% more than wholesale price on each bottle.
