The Wine Curmudgeon

The Kentucky grocery store court decision

Which made interesting reading, even for those of us who haven’t had a law class since the late 1970s. Federal judge John G. Heyburn II ruled that the that Kentucky law that prohibited grocery stores from selling liquor but that allowed drug stores to do so was unconstitutional. Heyburn wrote that it seemed kind of silly that “a grocery-selling drugstore like Walgreens may sell wine and liquor, but a pharmaceutical-selling grocery store like Kroger cannot.”

That’s the good news for those who want to see wine sold in grocery stores in the 19 or so states where it’s illegal. The bad news, as my pal and attorney Lou Bright (one of the top liquor lawyers in the country) told me, is that the decision will have almost no effect anywhere but in Kentucky, given how unique the state’s law is.

In addition, Lou said, the distinction between which stores could sell liquor and which couldn’t “was drawn on a factor that didn’t have anything to do with the sale of alcoholic beverages or any policy interest related to them.” So the judge’s decision was reasonably straightforward.

How often does that happen in liquor law?

How people really buy wine

The wine business – and especially wine writing – is dominated by the idea that consumers buy wine based on scores, reviews, and the good taste that those in charge share with the masses.

Which, of course, is so far from the truth that I’m surprised anyone still believes it. Or, as I saw last week at a World Market in Dallas (and yes, the Wine Curmudgeon was chuckling as he watched):

20-something woman: “I need to buy some wine for a party.”

Store employee: “We have this wonderful pinot noir, great scores, won a gold medal.”

20-something woman: “Do you have something that costs $8 a bottle?”

One more time, for those of you not paying attention –- only 60 percent of Americans drink wine. Of those of us who do drink wine, 20 percent of us account for 9 out of every 10 bottles sold. And we ain’t drinking first growths, as anyone who has bothered to look at sales studies would know.

Which means there are more consumers like that 20-something woman out there than many of us want to admit.

Wine of the week: Rene Barbier Mediterranean Red NV

Yeah, yeah, I know. What is this wine – perfectly acceptable as a $5 fill-in when there is not much else to drink – doing as a wine of the week? All I can say is that the Wine Curmudgeon is as surprised as you are.

I bought this at the end of a long, tiring stretch that saw too much travel, too little time at home, and too much work. All I wanted was something to drink with dinner, and since dinner was hot dogs and beans, I didn’t need much.

The Barbier ($5, purchased) delivered so much more than that. This used to be the red wine I recommended to people who didn’t like red wine, since it was soft and cherry-ish and could be chilled. This "vintage," though, is completely different.

The wine has more structure, including tannins, which I don't remember it having. In addition, the fruit is darker and more Spanish in style (with more acidity), and certainly not soft cherry. I think there is more and better quality tempranillo in it than before, which would account for the difference.

Having said that, there is no guarantee that the wine will taste like this in six months, since it’s non-vintage; the blend could change when the producer makes the next batch and it will go back to what it was. Until then, enjoy the improvement. At $5, this is a steal.

Winebits 243: Wine economics

We seem to have a theme this week, no?

• Consumers want to pay less: And no less than the guy who runs influential importer Frederick Wildman says so. Richard Cacciato told Shanken News Daily that, after the recession, “[w]e saw a radical change in purchasing patterns almost overnight. … Labels that were being sold for $75-$80 were repositioned down to $50-$60. For wines retailing at more than $20, we found ways to bring them in under $20. That created a perceived value in these products.” Cacciato also says the recession forced Wildman, hardly known as an importer of cheap wine, to restructure its business to allow it to focus more on grocery stores and mass market retailers like Costco. If Wildman is doing this, what does it say about the increasing importance of grocery stores in the wine business?

• Why does it cost that much? Tim McNally looks at why a bottle of wine costs what it costs, and discovers that it may not have as much to do with the actual expense as we think. “Wineries are trapped in pricing given the types of grapes they are working with, and where they are located. A great bottle of Napa Valley Oakville Cabernet Sauvignon may be perfectly acceptable to you in the $75 range, but move just a few miles north to Alexander Valley in Sonoma and that won’t fly.” We also hear about Tim’s brief foray into the banking business, which sounds like it was a lot of fun.

• Bring on the sweet wine: California winemakers who want to sweeten their product can’t add sugar; it’s against the law. Instead, they add grape juice, and that mostly comes from the Thompson seedless table grape. And guess what prices for Thompsons are doing as the 2012 harvest begins? Going sky high, reports the Western Farm Press, with prices as much as 23 percent higher than 2011. Some of this is being caused by what looks to be a smaller Thompson crop, but it also points to increased demand as wineries ramp up production of sweet wine.

The Italian Wine Guy gets what he deserves

The Wine Blog Awards were announced over the weekend, which usually merits a short in the Tuesday winebits notes post. But Alfonso Cevola, whose On the Wine Trail in Italy won this year’s award for best single subject blog, deserves more than a short mention.

Yes, he is a friend of mine (fortunately, he wasn’t penalized for that). Alfonso is one of the good guys in the wine business, someone who cares more about sharing the joy of wine with others than with being famous or scoring points at someone else’s expense. His writing is often lyrical, and always on target. It’s about the way wine should be, and not the way wine has become. Which means, as Alfonso recently noted, no posts about the five top Super Tuscan trophy wines, but posts about how Italy got so turned around that it cares too much about things like that.

The voters for these awards did the right thing. That even made a crank like me smile.

Making money in the wine business

The old joke asks: “How do you make a million dollars in the wine business? Start with two million dollars.”

Rob McMillan at Silicon Valley Bank has given the joke some substance. A recent post on his SVB on Wine blog sheds light on the super-premium segment of the market, and the results are intriguing: “… a lot less than the dreamy consumers imagine.” And, I might add, a lot less than dreamy lawyers, surgeons, and entrepreneurs who want to open a winery as a second career might imagine.

The data covers U.S. west coast wineries between 2002 and 2012 that make between 3,000 and 1 million cases a year and where the average shelf price is $30 a bottle. In this, it demonstrates just how poor an investment making fine wine is. Rob was kind enough to let me use his chart, which you can find here (click on the image for a larger version).  More, after the jump:

Expensive wine 42: Newton Merlot Unfiltered 2005

It’s probably too much to call this wine an anachronism, but it is a snapshot of what life was like in a certain part of the wine business just in those warm, sunny summer days before the recession.

The Newton ($40, sample) is Napa Valley wine the way a certain segment of wine drinkers, critics, and retailers thought Napa Valley wine should be – rich, luscious, ripe, and alcoholic (15.6 percent, believe it or not). It screams “Give me more than 90 points!” and descriptors like intense only begin to tell the story.

These days, it’s more difficult to find wines made this way. The recession played its part, devastating the super-premium wine business. Meanwhile, consumers seem to be tiring of high alcohol, while cooler harvests in California the past couple of vintages have made it more difficult to get wine to taste this way.

For the Newton is distinctive. Though it’s a huge wine, it is more interesting than others of its ilk, with more balance between dark fruits, silky tannins, and the acid than I expected. Having said that, it needs food, and manly food at that – big slabs of red meat. Otherwise, after two glasses, you're done. That so many people wanted that sort of thing almost makes me want to wax nostalgic.