Sunday, December 8, 2013

Is Wine Getting More Expensive?

Gradual, small changes over time become the new normal without you even knowing.  This is how I feel about wine prices right now.  A casual survey of retail store shelves shows that while many new brands have replaced others, reliable sellers retain their prized spots - and their prices have risen by more than just a little.

Wait.  Is this accurate?

I couldn't find an index that tracks prices of everyman wine over time, so this casual survey will have to suffice.  Still, I think it's informative.  To see if it is, I jogged back to a few dozen Winethropology reviews from back in 2009.  Four years ought to be enough to test whether a trend is afoot or now.  Know what?  Maybe prices aren't rising - not in an absolute sense anyway.

There is no rule or common denominator here in terms of price points or quality, but one thing's for sure - almost no producers are lowering their prices.  In fact, some producers' price hikes are flat out audacious.  A few supporting observations that help show just how ballsy it is to raise prices (in some cases 20-40% over four years) so high:
  • Quality has not surged in recent years the way that it has in recent decades, so it's not like you're suddenly getting a vastly superior product for the money.  Hell, California is still trying to shrug off two of the worst back-to-back vintages in along time, Australia is in the throes of a pubescent identity crisis, and much of the Old World is still trying to figure out if it wants to be Old World.  
  • Inflation is generally insignificant in this analysis.  Wages have stagnated.  Can producers argue that they should charge more because their customers can pay more?  Doubt it.
  • Scarcity is crap.  Rumors of lean, precious yields surface periodically only to be debunked by farmers who actually work the vineyards.  Vineyard management (thanks to deep well irrigation) is such a tightly controlled science anymore that yields are a more a function of desire than of Mother Nature.  So, please, don't buy the "2013 was an incredible year, but there's only a little of the special wine to be had" BS.
The truth is that, as time goes by, some wineries bank the gains of their successes and others reinvest. In other words, while some brands pass efficiencies of scale on to customers in the form of price stability, many large others are raising prices.  In an upcoming piece we'll look at which producers hold the line on quality and price - and which do not.

In the meantime...

Cheers

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