This week’s wine news: Another expert says premiumization is hurting wine, plus wine for world leaders and U.S. alcohol consumption
• “Doom loop:” Who knew a big-time market analyst would agree with the Wine Curmudgeon? Sonoma State’s Damien Wilson says premiumization “can be a path to ruin.” He even has charts and statistics to prove his point. Wilson, writing for Wine Business International, says “European wine market history shows that failing to recruit new wine consumers is the last thing the U.S. wine sector should be doing right now. As the number of wine consumers in the U.S. has stalled in recent years, the local wine sector should avoid profiteering in favour of new market investment. Here is where the US wine sector’s global leadership in business practices can come to the fore.” In other words, higher prices for the sake of higher prices scare off new wine drinkers and then demand slows. And we’re where we are today – flat growth and overpriced wine.
• World power wine: What does one serve the president of France and the Chinese premier at a leading international trade show? High-end French wine, of course. France’s Emmanuel Macron and China’s Xi Jinping sampled three amazing bottles – Louis Latour’s Corton Grancey Grand Cru 2010, Gérard Bertrand’s Château L’Hospitalet 2016, and the Cheval Blanc 2006. That’s about $900 worth of wine, though the Bertrand is a comparatively inexpensive $35.
• U.S. booze consumption: The typical U.S. resident drinks the equivalent of about a case of wine a year, according to the OECD, an international group that tracks a variety of economic indicators. The agency’s 2019 report on beer, wine, and spirits consumption shows that the U.S. is not only exactly average for the 36 countries in the survey, but that consumption is almost unchanged from 2007. So it becomes even less clear what the neo-Prohibitionists are complaining about.
Photo: “Modern wine tasting” by kellinahandbasket is licensed under CC BY 2.0
This week’s wine news: The Russians cut alcohol consumption by 40 percent, while we find that affordable red Bordeaux costs $20 and a stadium beer vendor got caught overcharging even more than restaurants do
• Impressive decline: The neo-Prohibitionists must be rejoicing at the news: “Russian alcohol consumption decreased by 43 percent from 2003 to 2016, a World Health Organization report says.” The BBC report says the decline is credited to advertising restrictions, increased taxes on alcohol, and a ban on alcohol sales between certain hours – all of which have been proposed in one form or another by groups like the Centers for Disease Control to cut U.S. wine, beer, and spirits consumption. The catch? Russia has traditionally been one of the heaviest drinking countries in the world, and the drop in consumption more or less caught Russia up to the rest of the world. For example, the average life expectancy for Russian men rose to all-time high at 68. But it’s 70 for men in the U.S, despite a recent decline, and 79 for men in western Europe, where drinking is common.
• Such a deal: Charles Passy, writing in Market Watch, says we can still find affordable red Bordeaux, and he defines affordable as almost $20 a bottle. This is where the Wine Curmudgeon reminds the Winestream Media that $20 a bottle is more than twice the average price of wine sold in the U.S. and that most of us will never spend $20 for a bottle of wine. Or that much French wine that isn’t rose has been overpriced for years. But, given the current climate, if I do that, I’ll probably be criticized as a so-called consumer wine champion full of faux outrage.
• Expensive beer: Overpriced booze is nothing new on the blog, as the last item attests. But a Miami beer vendor did us one better. Says the New York Post: “A beer vendor … was arrested after charging a fan $724 for two beers on a personal credit card reader.” How did the vendor get caught? The fan’s credit card company alerted him to the attempted theft on his phone – saved by the same technology that made the overcharge possible. And no, the Wine Curmudgeon won’t make a joke about the winless Dolphins.
New data shows neo-Prohibitionists campaign against drinking may be making headway
Are the neo-Prohibitionists winning the debate about drinking? New data, including a study about world alcohol consumption, shows fewer of us are drinking. Does this mean more people believe their argument that all booze is evil?
Worldwide alcohol consumption declined 1.6 percent in 2018, according to a report from IWSR, a London consultancy. And wine, which had increased in consumption globally the past several years, also declined 1.6 percent in 2018. That included leading markets like China, Italy, France, Germany and Spain; the U.S. market was flat.
In addition, reported IWSR, “Low- and no-alcohol brands are showing significant growth in key markets as consumers increasingly seek better-for-you products, and explore ways to reduce their alcohol intake.” Growth of no-alcohol wine is forecast at 13.5 percent, with low-alcohol wine at 5.6 percent. Those are impressive numbers to begin with, even acknowledging the small base, and it’s even more impressive given how few no- and low-alcohol wine products exist today.
Meanwhile, Australians – usually regarded as some of the world’s great drinkers – have cut their alcohol consumption significantly since 2014. No one was more surprised than the CEO of the research institute that did the study, who noted that booze is seen as having “a central role” in Australian life. But no more?
What’s going on here? Know that the IWSR study includes a variety of caveats about why consumption declined, and that it expects drinking to return to growth over the next several years. But when the study identifies Ethiopia as one of the top 10 growth markets in the world, something is much different than we’re used to.
In this, it’s almost certainly the idea that any kind of drinking is bad for us. The IWSR study hints at this, with the growth in no- and low-alcohol products, but so does something else. In the U.S. we’ve always faced a religious backlash against drinking, and it’s the main reason why so much of the country was dry until the 1990s.
But that backlash seems to have ended. A May 2019 Gallup poll found that 79 percent of Americans found drinking morally acceptable; only 19 percent said it was a sin. That makes booze as acceptable as divorce and more acceptable than non-marital sex, says Gallup.
So if more of us are drinking less, and that seems to be the case, then the neo-Prohibitionists’ scare tactics seem to be working. Hopefully, the wine business will eventually take notice and offer a compelling argument in favor of moderation. Its current hear no evil, see no evil, premiumization is the answer to everything policy might work in the short run, but doesn’t offer much for the future of wine drinking in the U.S.
More about the neo-Prohibitionists and drinking:
• Health alert: Does the CDC know how dangerous Starbucks’ pumpkin spice latte is?
• Cigarettes, wine, and cancer
• The federal government’s three drink limit
The number of of us who prefer wine over beer and spirits is at a 14-year low
Unwelcome news for those of us who care about wine: The number of Americans who say they prefer wine over beer and spirits is at a 14-year low.
A July Gallup poll found that 40 percent of us who drink alcohol prefer beer, while 30 percent prefer wine and 26 percent like spirits best. The 30 percent figure is the lowest since 2003, and approaches the historical lows of the 1990s. The trend has continued downward since its peak of 39 percent in 2005, when wine passed beer as the most popular alcoholic beverage in the U.S.
So what’s causing this?
• Premiumization, in which we’re paying more for wine that isn’t especially better. Higher prices almost always have something to do with how we decide what we buy. The downward trend, which started in 2009, almost exactly coincides with premiumization.
• The decline in restaurant wine sales, again thanks to higher prices. Those of us who might have a glass or two when we eat out may have given that up to save money.
• The craft beer movement, as well Big Beer’s panic-fueled marketing to regain the favor of U.S. drinkers.
• An uptick in the number of Americans who say they don’t drink, at around 38 percent from 35 percent in 2005. My guess is that many of these people are wine drinkers who drink only on birthdays, anniversaries and holidays, but have given up alcohol for health or pricing reasons.
This week’s wine news: How is this for a foolish wine drink? Hot chocolate made with cabernet sauvignon, plus Texas wine and booze consumption
• Not in my mouth: The Wine Curmudgeon is ever vigilant to keep the hipsters and various dudes from doing to wine what they have done to other parts of American life, like the fedora. So know that one of their newest is something called red wine hot chocolate, which made me shudder when I read about it. Talk about a foolish wine drink. Mixing red wine and chocolate is bad enough, but red wine and milk? Note to hipsters: There is already something like this, and it’s called Irish coffee, and it will get any winter drinking job done that needs getting done without ruining a decent glass of red wine.
• Not in my state: How do we know Texas wine is worth drinking? Because a glossy travel magazine quotea a San Francisco food and wine writer saying so. There is a Curmudgie in this for someone, I think. “As a wine writer in California, I certainly don’t feel any need to pay attention to Texas,” says Jordan Mackay. “But as someone who grew up in Texas, I’m fascinated by it. The fact that a wine culture can switch from inappropriate grapes to esoterica like Trebbiano and Montepulciano is really cool.” How did I ever go all these years without once using the word ‘esoterica’ in any of my writing?
• Not in my country: Alcohol consumption in the United Kingdon has fallen by nearly 20 percent over the past 10 years, and alcohol per capita is about the same as it was in 1979, reports thedrinksbusiness.com. Apparently, the country’s campaign against booze, which has included education, minimum pricing, and new laws is working. In this, says the article, the British drinks business must focus not on getting people to drink just to drink, but to get them to drink whatever will become popular as these drinking patterns continue to change. It’s an interesting article and speaks to the challenges facing the alcohol business as younger people drink less than their parents and grandparents.
This is not a critique of the science in the Centers for Disease Control study that equated drinking wine with dinner as binge drinking. I’m not a doctor or researcher. I’m also not questioning the health, emotional, and social costs of alcoholism; I’ve attended too many funerals.
Rather, this is a critique (based on a story I wrote for the Wine Business International trade magazine) of the shoddy and slipshod reporting done by most of the media, wine and otherwise, when the study was released. That is something I am qualified to do after 35 years as a journalist.
Journalism, something that I love and have spent my professional life trying to do well, is in a sorry state. How the study was covered demonstrates this all too well. Too many news organizations, regardless of size or reputation, are lazy, sloppy, and willing to accept what someone says — be it the CDC, the government, or big business — without asking questions. And journalism is about asking questions. These days, though, it’s cheaper and easier and less offensive to advertisers if you re-write a news release, throw some hyperlinks in it, and call it reporting. Or rewrite what another news organization has already rewritten.
My reason for being, even in wine, is to try not to do that. Here are the questions the media didn’t ask when the CDC study was released:
• Where did the excessive drinking standard come from? Why is the standard eight drinks a week for women and 15 for men? In fact, these come from a 2006 study in the American Journal of Preventive Medicine, and are based on the U.S. government’s dietary guidelines: “drink alcoholic beverages… in moderation, which is defined as no more than 1 drink per day for women and no more than 2 drinks per day for men.” Which is not exactly the same thing as excessive drinking.
• Why does this study contradict what one eminent cardiologist told me “is a reasonable certainty, based on hundreds of studies over the past decade, that moderate drinking as part of the Mediterranean diet that includes fruits and vegetables, olive oil, and wine, will benefit cardiac health. It’s the difference between partying and wine with a meal.”
• Why now? Why is alcohol suddenly in the spotlight? Note that the CDC study came in the wake of the proposal by the National Transportation Safety Board to lower the blood alcohol limit for drunken driving by one-third.
• Why these solutions — higher taxes, fewer liquor licenses for stores and restaurants, and an end to wet-dry elections and state deregulation? Will these prevent alcoholism, or will they penalize responsible drinkers?