Category:Wine news

Winebits 787: Ingredient labels, icewine, Valentine’s Day

by Wine Curmudgeon Posted On

woman with shocked expresson
“Lambrusco? Why didn’t I think of that?”

This week’s wine news: Has the backlash against ingredient labels started? Plus, more bad news for icewine and wine advice for The Holiday that Must Not be Named

• Wine is not Cheetos: So writes one of the most respected attorneys who works with liquor law. Sean O’Leary, the Irish Liquor Lawyer (and who has been quoted on the blog many times) wonders if the idea of nutrition and ingredient labels is misguided, and predicts a flurry of lawsuits if the federal government follows through on what seems to be its plan to add the labels over the next couple of years. “What this really is about is opening the floodgates to class action lawsuits against producers,” he writes, arguing that some of his colleagues will bring lawsuits against wineries for inaccurate labeling, It’s an intriguing defense of the status quo, and one I’ve not heard before: We can’t have labels because some attorneys will misuse the process.

• Whither icewine:? Icewine, one of wine’s great treasures, has long been endangered by climate change. Icewine requires tremendously cold weather; if the grapes don’t freeze on the vine long enough, there’s no icewine. Now, reports the CBC, its future is even cloudier. Production in Ontario, one of the best places in the world for icewine, has dropped sixfold by one measurement since 2018, and the number of producers has dropped from 41 to 10. The weather has been one reason, along with the pandemic cutting demand, and especially in Asia.

• Not the same old: Lifehacker, the blog’s unofficial website for mainstream wine news, offers a fine piece of advice from Claire Lower for ordering wine for The Holiday that Must not be Named: “Order the weird wine.” This, of course, is right up the WC’s alley, who has long advocated for wine from less known regions and made with less known grapes. I especially liked this: “ ‘Pet nats’ — naturally sparkling pétillant-naturel — are also a good bet, but those are popular and don’t have quite the same cool factor as ordering an orange wine or Lambrusco.” I’d argue that orange wine is past its prime, as well, but anyone who recommends Lambrusco in this day and age gets a tip o’ the WC’s fedora. And this Lambrusco is damned fine.

 

Big Wine 2023

by Wine Curmudgeon Posted On

Wine Business Mnnthly magazine cover Feb 2023Big Wine has done the seemingly impossible: Make less product, but still control 90 percent of the market

The most telling statistic in the 19th annual Wine Business Monthly’s survey, which ranks the 50 biggest producers in the U.S.? That the market share controlled by the 100 biggest companies has not changed all that much – even though many of them are actually producing less wine.

Which pretty much sums up the crisis facing the U.S. wine business as sales decline, its core customers age, and the rest of the country drinks something else.

The pie is getting smaller, but the biggest companies still slice off the same size piece. That’s certainly not good for the other 11,000 wineries, and it’s not even particularly good for Big Wine. Success is about growth, not maintaining market share.

In other words, as one industry analyst noted earlier this year, “This is obviously a place where none of us want to be. If a rising tide floats all boats, then a shrinking tide is the opposite. In that case, we’re in a Darwinian model, where the only way to get business is by taking it from someone else. And that’s obviously a place where we don’t want to go.”

Frankly, I was stunned when I finished parsing the numbers. Case in point: the study says E&J Gallo, the biggest producer in the world, hasn’t increased its sales in the U.S. in several years. But Gallo still accounts for almost one out of every three bottles made in this country.

Even more revealing: The 10 biggest producers have lost a stunning amount of market share, from controlling about 4 out of 5 bottles in 2016 to three-quarters in 2022 — even though the top 100 still control 90 percent. This is a business school example of cannibalization: Those in the next 40 are stealing market share from those in the top 10, and no one is necessarily better off.

Here are some notes of interest from the study (for those of you who haven’t already started drinking in despair):

• There are 11,691 wineries in the U.S., a three percent increase from last year.

• Eight of 10 wineries in the U.S. make fewer than 1,000 cases while a third make fewer than 5,000 cases. There are 281 medium-sized wineries making 50,000 to 499,999 cases—counting both bonded and virtual wineries. There are 79 large wineries in the U.S. making 500,000 cases or more.

• Some historic and important wine names have seen production slump over the last year. They include Bronco, makers of Two-buck Chuck, which suffered an 11 percent decline, and supermarket stalwart Ste. Michelle Estates, down 15 percent.

• The three biggest producers have seen their share of the market fall by one-sixth since 2017 – even though Gallo bought a sizable chunk of then No. 2 producer Constellation Brands a couple of years ago.

More about Big Wine:
• Big Wine 2022
• Big Wine 2021
• Big Wine 2020

Winebits 786: Cheap wine, Mike Dunne, Stella Rosa

by Wine Curmudgeon Posted On

Woman drinking wine
“No more Yellow Tail for me — Stella Rosa.”

This week’s wine news: The cheapest countries for buying wine (and we know what isn’t), plus Mike Dunne’s new book and Stella Rosa tops Yellow Tail

• Not the U.S.: Regular readers of the blog won’t be surprised to hear this – the U.S. ranks as one of the most expensive countries in the world for wine. That’s according to Food & Wine, which parses a study that says Portugal is the least expensive, averaging $4.30 per bottle. Hungary ($4.81), Chile ($5.13), Slovakia ($5.37), and Germany ($6.02) complete the lowest five. The fourth most expensive – and the only one among the priciest that is a major wine producer – is the U.S. at $15.18 a bottle. What makes this that much more depressing is the most expensive countries either don’t drink much wine or don’t make any, like Iceland, Norway, and South Korea. But that’s nothing we didn’t know, is it?

• Mike Dunne: Dunne, a long-time friend of the blog, plugs his new book, “The Signature Wines of Superior California,” on YouTube’s The Varietal Show. The book has been a work of love for Mike; he has talked about it for years. The book’s website is here; I’ll get with Mike and see if he wants to give one away as part of the blog’s upcoming Substack anniversary celebration.

• Topping Yellow Tail: Stella Rosa, the producer whose roots are in Los Angeles’ tenure as a key wine region, is the top imported wine in the U.S. It replaces Yellow Tail, which has been the leading import for almost two decades. The change is a combination of Yellow Tail’s sales decline (about a 14 percent drop since 2020) and Stella Rosa’s rapid growth. Stella Rosa has showed up on the blog a time or two – an example of a popular, sweet-style wine that has made inroads among younger drinkers.

Winebits 785: Young people, paper bottles, Aussie Prosecco

by Wine Curmudgeon Posted On

Mother holding baby
“No wine for you — or for Mom.”

This week’s wine news: Even a lifestyle tips website has noticed young people don’t drink. Plus, paper wine bottles and Aussie Prosecco holds up a trade deal

• Young people and drinking : Stephen Johnson, writing for the Lifehacker feature, “The Out of Touch Adult’s Guide to Kid Culture” has discovered that younger Americans don’t much drink. “You’d think all this alienation would lead to alcoholism, but nope: Gen-Z just doesn’t drink as much as previous generations. Americans overall are drinking less, but the drop is most noticeable among younger people. The number of college-aged people who don’t drink any alcohol has jumped from 20% to 28% over the last ten years.” Note to wine business: If Lifehacker has figured this out, and it’s not like booze is its business, why haven’t you?

• Bring on the paper: Italian wine producer Cantina Goccia, the first drinks brand to release wine in a paper bottle, will help other wine producers switch from glass to paper, reports thedrinksbusiness. The paper-ing facility, in Umbria, will start with 1,000 bottles per hour; plans are to eventually double that. Paper bottles, as has been noted on the blog, have not enjoyed even the small boosts that cans and boxed wines have. The bottles use a paper shell, food grade recyclable plastic pouch,and metal screwcap.

• Free trade – sort of: What’s a key obstacle to a free trade deal between Australia and the European Union? Sparkling wine made in Australia called Prosecco. Bloomberg reports that the EU won’t agree to anything until the Aussies stop calling one of their bubblies Prosecco, which is the protected name for the Italian sparkling wine (and, apparently, the EU is irked that there is an Australian cheese called Parmesan). Regular blog visitors know that U.S. producers can’t call their products by European names; the U.S. and EU did a deal in 2006 so that (for the most part) U.S. wine can’t be called by European names like Prosecco, Champagne, Port, and Chablis. The Aussie Prosecco, though, has been a sticking point for years.

 

Winebits 784: Ingredient labels, UPS, value wines

by Wine Curmudgeon Posted On

wine nutrition fact box
Coming by the end of the year?

This week’s wine news: Ingredient label update, plus a UPS joke and $40 value wines

• Coming soon-ish? Michael Kaiser, who oversees government relations for the Wine America trade group, says we should see regulations requiring “Serving Facts/Nutrition and Allergens labeling” on wine bottles this year. It will probably be a little longer for a final rule for ingredient labeling, which has to go through another comment period. I was optimistic that we’d see extensive labeling required, but watching the wine business dig in its heels since last fall has made me reconsider. It was particularly distressing to see Philana Bouvier, president of importer, wholesaler and marketer Demeine Estates, tell last week’s SVB wine report audience that consumers didn’t care how many calories were in a glass of wine; hence, no need to put it on the bottle.

• Good old UPS: Evan Andrews, the blog’s unofficial weather forecaster, has apparently had the same problems with UPS and Fed Ex that so many blog readers have had. Andrews wrote the following on Facebook last week, which was posted over a picture of a less than accommodating UPS driver: “As a kid, did u ever knock on people’s doors and run away before they answered? Well, guess what, they’re hiring.”

• Always the Spectator: The Wine Spectator unveiled its annual list of value wines last week, and heading the rankings? A $33 cabernet sauvignon from Napa Valley’s Beaulieu Vineyard. Ironically, that was not the most expensive wine on the list, which includes “values” costing as much as $40. I guess this post, from wine marketer Tom Wark, was more prescient than we realized. Wark says wine’s problems are centered around cost, that wine is too expensive for most of us. I wonder: Would anyone at the Spectator agree with that?

Follow-up: SVB wine report 2023

by Wine Curmudgeon Posted On

 

wine people bring to a party chart

The wine business’s house is on fire. Why doesn’t anyone in the wine business notice?

This year’s 22nd annual Silicon Valley Bank state of the wine industry report reminded me (with many apologies to President Franklin Delano Roosevelt) of the story about the neighbor’s house catching fire. Study author Rob McMillan wants to lend the neighbor his garden hose, in the form of a wine industry marketing campaign. It might not be enough to put the fire out, but it’s better than what the wine business wants to do – wait for the fire to put itself out, assuming there even is a fire.

Because wine’s house is on fire — people younger than 60 have pretty much given up on wine, according to the report.

“I don’t know what the wine business is doing to drive growth among younger consumers,” McMillan told the report’s webinar audience. “But they’d better stop, since it isn’t working.”

Two charts from the report demonstrate this. The first, at the top of the post, shows the booze people bring to a party, based on their age. And the only people much interested in bringing wine are ready for Social Security. Click here to see a larger version. The second, which is here, shows that people who don’t start drinking wine when they’re young don’t magically start drinking it as they get older.

Talk about a fire.

McMillan’s proposed WineRamp marketing plan, which was similar to the California Raisins and “Beef: It’s what for dinner” campaigns, was shelved last year after considerable resistance from the wine industry. Serious division remains about whether it was needed, let alone whether it would work. But anyone who questions the need for more and better wine marketing is living in 1990 and waiting for “60 Minutes” to air its French paradox story. Which, of course, isn’t going to happen.

And I can’t speak to whether something like the Raisins would work; several wine marketers I respect insist it would be a huge and costly failure. But I can see the house next door is burning down, and if my garden hose is the only thing handy to put it out, then I will use my garden hose. Because I know the fire isn’t going to put itself out.

SVB wine report 2023

by Wine Curmudgeon Posted On

Man slumped over computer
“Negative demand growth? Say it ain’t so, Rob!”

Think the WC is full of gloom and doom? This year’s annual wine industry survey takes gloom and doom to places where even I’ve never been

The annual Silicon Valley Bank state of the wine industry report, released yesterday, is so full of gloom and doom that it sounds like I wrote it after a too long day tasting $18 smoooth red wine. But Rob McMillan, the study’s author, is hardly a curmudgeon.

Which should tell you the desperate situation facing the wine business – too high prices, too few drinkers, too few people interested in wine, and no one in wine much concerned.

“This is obviously a place where none of us want to be,” said McMillan, speaking to an international webinar. “If a rising tide floats all boats, then a shrinking tide is the opposite. In that case, we’re in a Darwinian model, where the only way to get business is by taking it from someone else. And that’s obviously a place where we don’t want to go.”

Among the report’s findings:

• A decline in wine sales and demand — “negative volume growth” — for a second year in a row, as wine continues to lose market share to spirits.

• The two generations younger than the Baby Boomers are not going to flock to wine as they get older, no matter how much wine thinks they should: “Consumers younger than 60 have a lower share of wine consumption compared to what they did in 2007,” while about one-third of those 21 to 29 drink alcohol — but not wine. And expecting them to suddenly embrace wine just because is a march of folly.

• The divide between Big Wine, the 100 or so largest producers that control some 90 percent of U.S. production, and the other 10,000 or so small, premium producers is the biggest in memory. Which means the biggest producers have very little in common with helping the rest of the business survive.

• The lack of a strategy to promote wine – partly because of the divide in the business, partly because not everyone sees a problem, and partly because wine is wine — is having a consequence that’s obvious to anyone who looks at the numbers.

In fact, even the little good news for some wine producers isn’t especially good for the rest of us. There is growth for wines costing $15 or more, but since most wine sold costs less than $15, the trend is only benefiting the few.

Photo: “News Flash–Heat Bad for Productivity” by moria is licensed under CC BY 2.0.

More SVB wine reports:
• 2022
• 2021
• 2020