Prices: Old World vs. New World

Bob Kaminski’s thread about Grgich Hills got me thinking about wine prices. He mentioned Grgich’s “Violetta”, a nice enough dessert wine that carries a price tag of $80+ per 375. I’ve bought futures of many Rieussec half bottles for one-fourth to one-third that price!

With the Euro’s value relative to the Dollar, and with the costs of shipping and importing wine, it seems to me that domestic wines should present a superior value. Yet so often when I find a domestic wine I like, it’s a bad QPR compared to European wines of the same grape/blend and caliber. Does anyone else feel this way?

I totally agree with you. It doesn’t seem logical that wine made in a longer standing wine region that has to be shipped halfway around the world and run through a 3 tiered distribution system should be more expensive, on average. Being a QPR drinker, I am shocked that only 25% of my cellar is American with a higher average price of the rest of my cellar.

I don’t just feel that way, our entire business plan is based on it being true and the probability that it will ALWAYS be true. We often say this “America is the only wine producing country in the world where most people think wine is Art and not Groceries.”

So do you think that’s it, Roberto? Producers in NA are pricing their product as a luxury item rather than a staple? I’ll be interested to see if any domestic producers respond to this hypothesis.

Nearly 81% of my cellar is composed of wines from Europe. The remainder is US, Australia, South America, and South Africa. There’s a reason for that… given the types of wine I like, Europe does it better and costs less.

Other than Pinot, I think I can generally find a better QPR that fits my palate from Europe. With Pinot it’s a bit of a toss up for me, I’ve found some FANTASTIC Bourgognes for < $20 ish and I’ve found some AWESOME domestic Pinots, (most of which are slightly better than the Bourgognes) for < $35 ish. Bordeaux is the QPR KING for me.

Ed, Cali or OR pinots? And which ones?

I don’t have much experience with OR pinots so Cali. for now BUT I am heading to the Willamette Valley in early July so I’m on the hunt there!

Off the top of my head:
Rhys Alesia San Mateao
Rhys Alesia Sonoma coast *** killer for the money
Williams Selyem Sonoma County
The recent Kutch’s (although that’s pushing $40)

But even at $40 there are some pretty decent wines.

Ed, as I framed my initial post, Pinot Noir (specifically from Oregon) was the one exception in my mind. I can get really delicious cuvees here from producers like Cameron and Belle Pente for ~$20 that will drink well over a few years and complement a wide variety of foods. If there are bourgognes of the same quality at the same price point, I don’t know about them. The same producers have single vineyard wines in the mid $40 range that age gracefully and are worthy of special meals.

I don’t buy much Cab, but I agree with you-- it’s is the opposite. When I want Cab, I buy Bordeaux. Lynch Bages, Calon Segur, LLC, Cos d’Estournel… wines with serious aging potential and reasonable price tags.

Then there’s Riesling. I haven’t found a lot of domestic Riesling that I enjoy, but when I do find one, it’s always a poor value. There’s one here in the Willamette Valley that’s tasty, and it’s $25. That may sound inexpensive compared to that winery’s $75 Pinot Noir, but it’s on par with a German QBA. In other words, it’s a bad value.

Roberto, since you’re ITB and see way more wine prices than a typical consumer, can you explain why this is so? I know a lot of Napa Cabs are priced as luxury items, but is that also true of a $50ish Central Coast Syrah?

You just rattled off some of my fave Bordeaux! [drinks.gif]

Michel Gros Hautes Cotes de Nuits - $17 for 375ml - I LOVE that wine.

My guess is I’ll find some great Oregon Pinots in July! Cameron and Belle Pente are definitely on my radar! Thanks!

Others will probably have more suggestions, but I’d recommend hitting the following places for good examples of OR pinot typicity when you visit WV:

Belle Pente
Scott Paul
Domaine Drouhin

Plus, I’d definitely recommend you drop by and see fellow Berserker Jacki Bessler at Barbara Thomas Wines!

Thanks! Between you Melissa, and Major Franks I’ll be all set!

The model in the US has always been to aim high. Everybody in Napa has aimed at making 1st growth Bordeaux, the pinot noir folks elsewhere are figuring Burgundy Grand Cru and so on. Just knowing which wines of France to copy and using 100% new oak means you automatically get to expect and demand a premium. It’s the American way. Who here gets into this and says, my site is best suited to Languedoc blends, it will be great if I get $10-$12 a btl.
Who aims at cote du rhone when the same grapes can be marketed at CNP prices, I mean we have great weather here, every vintage is a good one so why not? Beaujolais is a nice drink but who would aim at that here in CA. Not when the same acreage can be plated to merlot and sold for twice the price.

I believe many wineries price themselves on the upper tiers to provide their customers with some type of piece of mind that they’re getting stroked with integrity. If the best in the world costs X, then mine too should cost the same. But this has nothing to do with quality or value, but that’s the wine biz. And realistically, if people are buying then they are not wrong.

Our wines are fairly inexpensive, $15-36 and hopefully provide a good value. And they have to because there is no marketing budget, heck there isn’t even staff, so what I see happening is more word of mouth. I hope it continues that way, but to get back to the original notion; expensive domestic product without a track record vs. old world yummies, I think P.T. Barnum said it best…

While it’s true what Roberto says in terms of demand and wine in the USA being a “special occasion” beverage, there are other factors. Wine is prized in the government, and therefore heavily subsidized much like corn is here in the US. AND, well these guys have been here longer. They aren’t still paying off vineyard land purchased in 1995.

Vineyard land is an investment not a cost. When those payments are done, they own valuable land that can even rise in value.

Melissa I largely agree with what you have to say, but it’s also a function of taste. If Alban and Pride blow your skirt up, it doesn’t matter what you want to pay, you buy those wines from the US. Ditto so many other wines that aren’t interchangeable.

That said, factoring in not just my tastes but also my feelings of the value of domestic vs. imported wine, my cellar is 2% domestic, 40% French, 40% Italian, and the rest a split of Spanish, Austrian and German… I own zero bottles from S. America or Oceana, for better or worse.

Melissa, you hit 2 of my 3 favorites (Cab [Bdx], and Riesling dead on target. The riesling comparison is especially stark imo… for instance, I just picked up '07 Selbach-Oster Bernkasteler Badstube Riesling Spätlese for $16 (so we’re not even talking QbA!). There’s nothing in the US that comes even remotely close to that in value.

My other favorite is Chenin Blanc… and, for the most part, we don’t do that here in the US.

I do.

While there are, without doubt, very fine wines made in the US, I hardly ever buy any. Some of my favorite US wines are from Dominus but I have never purchased any. I’ve probably bought less than 10 bottles of Ch. Montelena though I really like their cabs. I used to buy Opus 1, but stopped around 4 years ago. I still buy Mondavi Private Reserve cabs, but rarely. At that price level, I derive more pleasure buying Bdx, Burg, etc.

You, my friend, hit the nail squarely on the head.
Nice post.