What Will Happen in the Wine World in 2010?
by John Mariani
Not since that Millennium 2000 folly have I seen so much frenzy in the global wine market. Back then, with the stock markets booming, auction houses setting records for wines, and Champagne producers warning there would not be enough product for the celebration, everything in the wine world seemed upbeat and getting pricier by the month.
What a difference a decade makes. With high unemployment, shaky markets, pared-down expense accounts, and just too much wine being produced, it’s a very different world, one that plays into the buyers’ heart and pocketbook with lower prices, more choice, and less pretension. Those 99-point ratings don’t seem quite so requisite any more to buying good wine.
So what do I see happening in the wine market in 2010?
1.Prices will continue to drop across the board, from the priciest of Bordeaux and Burgundy to cult California wines that were once available only by subscription. This goes, too, for those Italian, Spanish, and Chilean wine producers who thought that they could easily get the same kind of money those age-old French and small estate California wines used to get.
2. More people will be buying wine online, where you can go to a site like winesearchers.com and compare prices for the same wine not just around the U.S.—where many states now allow cross-state shipping—but in Great Britain, Germany, and other countries. Often the range can be amazing: a wine costing $40 in one store may be $75 in another. Wine stores, whose profits come largely from inexpensive wines, will stock more of them and promote them like crazy.
3. Wine blogging will increase exponentially, mostly among those contending they’ve found spectacular wines that will “blow your doors off” for under $15 a bottle. As with all blogging, readers should always know the source of such claims. Making wine knowledge accessible is not the same thing as saying anything of much value.
4. Alas, I don’t see California backing away from big, high alcohol, oaky reds and whites anytime soon, because the producers continue to believe that is a style most Americans prefer to subtlety and complexity. The problem is that cheaper wines of this style are so often dreadful, out of balance, and undrinkable after one glass. California wineries talk a good game about finesse, but then they overripen their grapes and stick them in new oak for too long anyway.
5. The tsunami of new wines coming in from South America and Eastern Europe should ebb as the market overflows with what’s already in it. Greek, Portuguese, and Brazilian wines have had good press in recent years, but unless they keep prices way down, they won’t make much headway.
6. New Zealand wineries are in trouble mainly because of recent prodigious harvests that have glutted the market for the overly fruity punch-like style that has begun to fade among winedrinkers who want to move up in quality.
7. Champagne is in serious trouble, not just because prices got way out of whack with reality, with too many selling above $100 a bottle, but because other sparkling wine producers have been canny about getting their bubblies well positioned, extremely well priced, and well reviewed. Champagne is cutting back production and holding back product they’ve bottled to get some balance, but it’s going to a struggle to wean people away from Italian prosecco, California sparklers, and Spanish cavas and back to Champagne, which simply has far too many labels out there.
8. The cut in expense accounts has caused fine dining restaurants to sit on their previous big capital purchases of expensive wines. They’ll buy only nominal numbers of them until guests get back into the mood to tell sommeliers that “money is no object.” Good luck. This means lower sales of premium wines in the restaurant market. By the same token, fewer fine dining restaurants will even open, as more modest, very exciting new restaurants build their winelists around interesting, small labels from around the world and sell them at reasonable mark-ups. Since the big ticket wines aren’t selling in Las Vegas anymore, it’s going to be interesting to see just what kinds of wines the new restaurants in the troubled City Center will be selling.
9. More and more wine producers will be switching from cork stoppers to screwtops in an effort to stem damage to the wines in the bottle from corkiness and oxidation as well as to make wine more accessible to the average consumer. The dirty little secret is that most winemakers I talk to say they’d love to switch to screwcaps but fear buyers will think them cheap-looking. Very dumb.
10. Americans will buy more and more wine at the $10 and under level, while Europeans are already drinking less. The best bet for an expanding market is China, which is thirsty for good, inexpensive wine that they will soon be producing themselves.
John Mariani’s weekly wine column appears in Bloomberg Muse News, from which this story was adapted. Bloomberg News covers Culture from art, books, and theater to wine, travel, and food on a daily basis.