Category:Wine news

Consolidation in the wine business

This is one of the Wine Curmudgeon’s favorite topics, but it’s difficult to get people to pay attention. Too many consumers don’t understand that increased consolidation may well reduce their choices and raise the prices they pay.

The latest news? Constellation Brands, a $5.2 billion company, paid $885 million for the wine subsidiary of the company that makes Jim Beam. Constellation will get Clos du Bois, Geyser Peak, Wild Horse, Buena Vista Carneros and Gary Farrell. Constellation, incidentally, is a bigger company than PetSmart and Pizza Hut.

The always erudite Dan Berger has the best take on this: Consolidation will hurt the quality of the wine, unless everyone is paying very close attention.

Peter Mondavi’s perspective

Peter Mondavi Jr. Peter Mondavi Jr., regardless of anything else (and there are a lot of anything elses with the Mondavi family), knows wine. He is the son of Peter and the nephew of Robert, two men who are among the handful who have helped California wine become some of the best in the world.

So when Peter Jr. offers his perspective on the state of the wine business, as he did during a recent visit to Fort Worth, it ?s worth paying attention. Today, Peter runs the Charles Krug Winery in Napa Valley, which one part or another of the Mondavi family has owned since 1943. One of his goals? To make wine drinkers once again associate the family name with quality wine. This is something that hasn ?t happened much given the focus on the Mondavis ? various personal and financial woes ? mostly on uncle Robert ?s side of the family — over the past decade.

?It ?s incumbent upon our half of the family to show the Mondavis in as different a light as possible, ? he says. ?We want to continue the family name and heritage. ?

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Cheap wine and the weak U.S. dollar

$1 Ask foreign winemakers what their biggest problem is, and the answer is almost always the same: the historically weak U.S. dollar. ?We ?re getting absolutely slagged, ? says Hugh Hamilton, an Australian whose brands include Hugh Hamilton and Jim Jim.

How bad is it? The Australian dollar was worth more than 90 cents U.S. in November, its highest level since 1984. The euro, which French, Spanish, and Italian winemakers use, is at a record high of almost $1.50. It was worth $1.17 at the beginning of 2006. Even the Chilean wine industry is noticing the difference, as the peso continues to appreciate against the dollar. It is at levels it hasn ?t seen since 1999.

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