The Dark Side of Great Value

The Dark Side of Great Value

Behind every heavily discounted California and Chilean wine is a grape grower who is being squeezed. If the growers are forced out of the business, what is the future of wine?

This message, from a grower in the Wagram region of Austria, arrived in my inbox last week: “We have no wine left. A hailstorm in June devastated our vineyards. A hailstorm is a very local phenomenon and it hit us hard. Eighty percent of our vineyards are located within eyeshot of our winery. I usually wake up in the morning and look around with happiness and pride, but now I can’t hold back the tears.”
That tragic story is the story of farming around the world. Hail, drought, floods, pests—you name it. Vines are particularly susceptible to diseases because we expect them to do much more than nature intended by demanding the finest fruit in low quantities from rigorously trained and unnaturally pruned plants.

Around the world, grape growers are in trouble. In Australia, it is drought. In Languedoc, France, it is flooding. In California this year, heavy rains hit Monterey and Napa just before the Cabernet harvest. And, everywhere, the economic situation piles on extra pressure. Estimates in Sonoma are that 30% of this year’s crop will not find a buyer. Before the deluge, prices for the famed Napa Cabernets were down 50% in 2009 against 2008.

Should we feel for these men and women? After all, city dwellers believe that farmers are over-subsidized and always complaining. But I live in the country near Bordeaux. I watch the hours these farmers put in, often working on their land after they leave their other job, the one that brings them a real income and not a headache. Yesterday, a Saturday, the neighbor’s machines were out harvesting the maize until 9 p.m., well after dark. And they are back today, Sunday.

Grape growers are suffering because we are buying much less high-end wine and because there is an oversupply of grapes in the world. At the moment, anybody with a dream to plant vines should think again.

These tales of woe are all very well, I expect you’re thinking. But you want to remind me that I’m meant to be on your side, on the side of readers who want to get the best value, especially in these tough times.

Yes, of course. But as a reporter, I am also an observer of the wine scene in its entirety, and long-term. And what I see is that it’s tough in the vines. It can be a singular problem, like hail. But, as with producers in Languedoc or in Australia, it can be an endemic problem, one that will only go away by tearing up the vineyard to plant something else or by selling the land for housing. And in that case, a dedicated grape grower—maybe someone whose wines you have appreciated, or whose fruit has ended up in a blend you have enjoyed—is gone. The wine world is poorer for it.

Consider the other side of the grape supply equation: the big companies that, increasingly, control the bulk of what we buy, the companies that have economy of scale, the ability to pressure growers, and the willingness to discount to give us the under-$20 bottles that we crave. These big companies need to buy grapes. And because they are discounting at the retail end, they pay less for the grapes. All over California, growers are telling tales of big companies offering less per ton this year than last, of demanding to renegotiate contracts. The same is true in Australia. This year the average price for a metric ton of grapes is half to a third of what it was in 2008.

“I think that we are going to start to see good long-term growers leaving the industry, simply because they can’t make a viable return,” said Mark Mackenzie of Wine Grape Growers Australia earlier this year. “That ultimately threatens the basis of the industry itself.”
Next time you see a California Chard or a Chilean Cabernet with a tag that proclaims a third off the regular price, remember that it is reaching your store with another tag attached. That tag says “cheap grapes.” Behind both tags there is a man or a woman who has grown those grapes.

Let me leave you with another grower’s story, also from Austria: “The wasps are devouring the berries…terrace walls are collapsing. We could never charge the amount of money necessary to compensate for all the labour invested. I’m considering leasing the vineyards so I can earn some money and not have the worries and the work.”

Maybe they aren’t on the streets with begging bowls, but for many growers, things are hard out there.

Published on December 29, 2009
Topics: ValueWInemaking