Dr Vino's wine blog

SIPPED: miracles?
FIJI water LLC, which recently shut down production in a showdown with Fiji’s (military) government but then caved, will be turning their water profits into wine. In a merger of all caps, FIJI will be acquiring JUSTIN vineyard in Paso Robles. The FIJI CEO noted that JUSTIN has “fantastic products” and is “not a distressed asset.” According to Bloomberg, the Resnicks, the billionaire owners of FIJI, are the biggest growers of citrus, pomegranate, almonds and pistachios in the U.S.

SIPPED: another round
Will the Supreme Court extend to wine retailers their previous decision that liberalized winery shipping? We may find out since the Specialty Wine Retailers’ Association has appealed. [AFP]

SPIT: bubble pricing
An economist has some advice to wine collectors: Sell your Lafite. Now. [WSJ]

SIPPED: boats and dragons
And you thought our Cuvée 88888888 was brazen! File under: “How to succeed in China: get personal and put a boat or a dragon on your label.” [decanter.com]

SIPPED: end of an era?
“I think we’ve just come out of 15 years of wine criticism where there was really only one point of view.” SF mag tracks the evolution in California wine styles.

SPIT: inoculated discussion
If you’ve ever had a question about yeasts in wine, it’s likely been discussed on this epic thread on Wine Disorder.

SIPPED: sizzle
Chateau Angelus will be James Bond’s choice of red wine, reports decanter.com. The movie had an “unbelievable” impact on sales of the St. Emilion wine, says owner Hubert de Bouard. No word of how much, if anything, the tie-up cost. Just think what it would have done if he picked a cabernet franc from the Loire!

SIPPED: more sizzle
After recent successes in Hong Kong, auction houses Sotheby’s and Christie’s graced New York with sales this past weekend. The Sotheby’s sale grossed $5,403,527, blowing away the estimate, and the Christie’s topline was $3,652,140, a high for them for this year. Absentee bidders from Asia featured prominently.

SIPPED: fizzle (not fizz)
While Napoleon Bonaparte could always find a reason to have Champagne, whether in victory or in defeat, Remy Cointreau has found a reason not to: lack of profits. The cognac and spirits maker has engaged a bank to find a buyer for its unprofitable Champagne businesses, which include Charles Heidsieck and Piper-Heidsieck. Interested in their margins? Poke around their helpful web site where they lay bare the financials of their divisions, including €96.7mln sales for Champagne with a €4.0mln loss. [Bloomberg]

SIPPED: spooky vines
NBC is developing a series (not yet even a pilot) revolving around a “troubled family desperate for a fresh start that takes over a Napa Valley winery whose ancient vines possess dangerous mystical powers.” Aha! All those ancient vines in Napa… [deadline.com]

Vineyards have their pests: consider the baboons, rattlesnakes and bears we have discussed before as well as birds, deer and other vermin. But the latest threat is a human one: roving bandits.

Across three countries in recent weeks, grapes have been illicitly picked off the vines. In Washington State, 2,000 pounds of mourvedre grapes were stolen in what the vineyard manager described as “a professional job – a complete and clean illegal harvest.” In Germany, grapes destined for a small production wine called Sintfang-Cuvée were found missing a day before the scheduled harvest. And in the Languedoc, according to the Telegraph, one farmer had 35 tons picked clean, wiping out his annual crop.

Are these incidents related? It seems a far-fetched that there’s an international grape heist gang in operation. But that’s what an unnamed French detective told the Telegraph that “a wine mafia gang” targeting “some of the best grapes.” He elaborated: “We are undoubtedly dealing with the kind of upmarket criminals who steal old master paintings and antiques to order.”

Really? There was the attempted vine poisoning/extortion at Domaine de la Romanée Conti earlier this year and that surely qualifies as one of the best vineyards in the world. But 35 tons of grape with a value of $20,000 as was the case in Languedoc? A German wine that is not even commercially available but rather given to the town councillors? These hardly sound like “some of the best grapes” in the world. At any rate, it is sad to see the fruit illegally plucked from the vine.

Will this outburst lead to the rise of Chateau Razorwire, a fenced vineyard with a panopticon in the center? Of course, back in the day, some of the best vineyards in Burgundy were “clos,” or walled vineyards. Chateau Razorwire would have a tad less charm.

The British tabloid The Sun reports on wine fraud at a British supermarket: a wine consumer in Britain says he bought an obviously fake bottle of Louis Jadot Pouilly-Fuissé on closeout at Tesco. The consumer says that the label was so bad that it “looked photocopied” and had a screwcap instead of the normal cork closure. Moreover, he told The Sun, that it didn’t pass his taste test at home: “Instead of a nice French Burgundy, this was a cheap German Hock or Liebfraumilch.” A Tesco spokesperson admitted to finding “a small number of counterfeit bottles” and said that they were investigating the matter. (Click for label photos.)

Most wine counterfeiting seems to happen with supremely expensive wines, where the profits can be great on a very few number of units sold. Also, fewer people are aware of what a ’21 Petrus label should look like let alone what it should taste like. But with a supermarket brands, it seems that fraud could be more easily spotted given the large number of bottles that would need to be sold (thus more eyeballs) and consumer expectations for consistency, either in the label art or the taste. Generally, people want a fake Rolex, not a fake Timex.

But passing off cheap red wine as pinot noir, that’s another story…

The euro hit $1.28 this morning, down from $1.51 in December. Does the lower euro mean that European wines are likely to get cheaper on store shelves soon?

While European travel will definitely be cheaper today than it was six months ago, wine importing doesn’t always work like that. (As a backgrounder, I examined wine and currency hedging when the dollar was headed the other way a few years ago.)

I tweeted about today’s currency situation and importer Jon-David Headrick replied in two tweets, at first joking, “This is our big chance to raise Cour-Cheverny prices by 30%!” (Cour-Cheverny is a tiny Loire appellation making wines from the obscure romorantin grape variety.) He elaborated: “Prices should fall unless importers have made the time-honored “when the euro falls you can raise prices” deals with producers…”

For a longer reaction, I put the question to Victor Owen Schwartz of VOS Selections who has been importing and distributing European wines–including Greek wines–for 23 years.

Yes it is low today but you know it doesn’t make sense to price one’s wines on the lowest spot rate of the day; what happens when it shoots up, do we just raise the prices? the market would love that! The level of volatility in the euro has been terrible, it’s a moving target. As you say, it has been over 1.50 in the not so distant past so if I am buying wines today and paying in 60 days or so, where will the euro be then? All that being said, with everything that is going on in Europe, starting with Greece, I believe that the basic metric of the euro assumption of importers will be decreasing. Now will that translate into lower prices on the shelf? My sense is that the wholesale trade will use the extra margin to make better buying opportunities for their retail and by-the-glass customers (volume deals) but not necessarily lower their prices. In these cases from what I have seen, some restaurants and retailers pass on the savings, some keep it. Don’t forget that #1, we are coming off of some rather lean years and #2, we are all selling less expensive wines so we need to make money somewhere.

As to the Greek situation, he said that “the impetus for exporting will only be that much more important.”

Hit the comments with your thoughts on the situation, especially if you are in the wine trade.

SIPPED: longevity
Tom Angove died at the age of 92 last week. Never heard of him? Well, in the 1960s he had the idea of putting wine in plastic bag, placing that in a cardboard box, and tapping it like a keg. His son, then 15 years old, told him he was nuts. Undeterred, Tom Angove commercialized the bag-in-box and forever changed how wine is consumed in Australia, Sweden and college dorm rooms. More recently box wine has crept upscale. Angove joins Robert Mondavi, Peter Mondavi, and Ernest Gallo as having lived well into his nineties. Maybe there’s something to resveratrol after all?

SIPPED: number crunching
Since we all have broken out our green visors and fired up TurboTax this time of year, we can now turn our attention to the economics of wine under $20 again. Jason Haas, general manager at Tablas Creek in Paso Robles, opens his books for us and walks us through his decision-making on whether a vineyard is worth developing to make a wine under $20. He considers the cost of land, labor, planting (dry farmed vs irrigated) to make his conclusion. If you like to wonk out about the business side, this post is a must! [Tablas Creek]

SPIT: Tart (and tact)
A surprising write up of the Mommessin Clos de Tart appeared recently: “The biggest disappointment was the 2006 Clos de Tart. Like so many red Burgundies from 2006 seem to be, it was underripe, excessively acidified, and almost textureless. It’s a sham, and it’s amazing how few people are willing to stand up and admit such stuff exists.” [Hedonist’s Gazette]

SPIT: good times
Hard to tell which phrase would strike more fear in the heart of Napa: finances that are “very weak” or “on life support.” Even foreclosure has been the fate of 10 vineyards in the valley that once was called “Eden.” But probably the scariest phrase is this: “High-rollers are discovering that there are lots of drinkable $20 to $40 bottles of wine.” [“Vineyard Defaults Surge as Bargain Wines Hurt Napa”Bloomberg]

SIPPED: gilding the lily
Ah, spring is in the air. And with it come California winery newsletters offering their wines for $74 a case–just the shipping, that is.

SPIT: California values
The Bay Area NYT is the latest to ponder the question of why are there so few tasty value wines from California.

SIPPED: Buffett’s billions
Warren Buffett is getting into the wine biz. Not as a producer, but as a distributor. Through his subsidiary McLane, Berkshire Hathaway is buying the Georgia wine and spirits distributor, Empire, reports Wine & Spirits Daily. I guess Buffett knows where the profits are in wine.

SIPPED: spurious variable?
Wine drinking women don’t get fat! But is it wine consumption that explains the slower weight loss among women in a study? Not necessarily. [Globe and Mail]

SIPPED: subway reading
A twenty-something male in office clothes was spotted reading Wine Politics on the F train! Good thing it wasn’t on Kindle or the Cover Spies wouldn’t have known! [CoverSpy]

Tragedy struck Chile overnight on Friday in the form of a massive earthquake that has displaced two million people, severed north-south bridges in the narrow country, and killed hundreds of people (see coverage on nytimes.com).

Chile has a large, export-oriented wine industry. Some of infrastructure, particularly in the regions of Maule and Rapel (including Colchagua), has been damaged or destroyed. Contacted via email, Lori Tieszen, executive director of Wines of Chile USA, says that Jose Manuel Ortega reports “devastation” in Maule and that his winery sustained some damage; Julio Bouchon of J. Bouchon, “is safe but his beautiful old winery is leveled,” Tieszen writes. In 2006, the Oxford Companion to Wine described Maule as “slowly changing its reputation of growing only bulk wine.”

“One can smell wine along the roads in front of the wineries. Tanks laying, collapsed buildings, barrels and glass everywhere,” winemaker Sven Bruchfeld told James Molesworth, wine critic for Chilean wine at Wine Spectator magazine.

Molesworth has been tweeting what he hears from wineries (follow his feed for the latest). Another source told him, “Big damage to the industry. Millions of liters on the floor.” He also tweeted that Montes and Lapostolle were hit hard in Colchagua, an area that had seen lots of investment in the wine indsutry. Feel free to add news in the comments if you have updates.

Depending on the region and grape variety, the harvest has already started or was scheduled to start soon in the country.