The Good News and the Bad News-

Great Wine Values from 40 Dollars to 99 cents

If you have been reading the newspapers the last few days or have been in any of the big boxes that sell wine, you probably have been shocked.

For months, we have been predicting that the basic economics of the supply and demand curves made it clear that 2003 would produce remarkable prices strongly favorable to the wine drinkers of America. We didn’t think, however that it would be a major disaster to the wine industry of the West Coast.

Yet all the signals were there. It was a powerful triple play. Domestic overplanting, low priced quality foreign competition and the weak economy have combined to create a glut at every level. Perhaps only the extreme cult wines that are deliberately produced in small quantities using the classic marketing techniques of the French Grand Crus will escape the impact. The purchase of these wines is based on ego satisfaction rather than any economic sense and have an inelastic curve.

However, while the consumer will benefit short term with lower prices over the next few years, the long-term prospects look dismal. Small wineries that offer excellent quality at fair prices may not survive. They will go out of business or be bought out by the Gallos, Mondavis, Beringers and Kendall Jacksons and the other giants who have access to the financing that will carry them through this difficult period.  Consolidation reduces and controls competition and eventually results in higher prices. One only has to look at Bordeaux and Burgundy to understand how it works.

But we might as well take advantage of our opportunities while they exist. Many wines that are now being touted as great values are in fact available in such small quantities that finding them is an exercise in futility. We will cover a limited number of wines that are available priced from $40 on down.

If you enjoy Super Tuscans but are unwilling to drop $100 plus for the Brunellos and Tignanellos, there is hope. The 1999 Avignonesi Toscana Toro Desiderio is comparable, readily available and priced at about $40. Ask your local wine merchant to order it if he does not have it in stock. It’s wonderful.  

Southern Rhone wines have been price competitive for the last couple of years. Guigal ’99 Chateauneuf Du Pape is considered by many to be the best quality red wine value in the world. It can be found for about $30.

If you can find it, Villa Mount Eden Cabernet Grand Reserve is under $20. Over the last few years, demand for Chardonnay has been so great that lower quality wine has flooded the market to meet the demand of those who say, “I’ll have a glass of Chardonnay, please”. Thus, there are few values in that white except for the magic of Columbia Crest who can deliver wonderful Chardonnay in quantity for around $10. They deliver the best overall wine values in the world and are widely available.

However Omaka Springs and Jackson New Zealand Sauvignon Blancs from the Marlborough Valley deliver wonderful fruity and dry wines that are my choice in white wines at around $15. Kendall Jackson in a preemptive strike has taken about $6 off of its entire value priced category so that you can find Chardonnay, Cabernet and a wonderful Pinot Noir on sale for under $10. 6 bottles gets you an additional 10% in most supermarkets.

The final amazement comes from Trader Joe’s and… it’s no joke…. The 99 Cents Store.  Bronco vintners, a giant out of Modesto got their hands on a broad range of quality Central Valley grapes, shipped them to Napa to be crushed, labeled them under the slightly deceitful Charles Shaw Napa name and sold them cheaply enough for Trader Joe’s to sell them for $1.99. The Sauvignon Blanc and Merlot are especially fine values and have held up in blind tasting with wines above $10.

The biggest blow came when Staton Hill dumped its ‘97 Cab which was produced to retail for over $10 to The 99 Cents store at a price that enabled the latter to retail this wine for… you got it… 99 Cents. While these two prices are shocking, you can be sure that neither of these prices are one time events. As this year continues, this is going to occur over and over with other labels that are in distress.