Pulling up vines is an effective way to make sure growers can make a living – so who's stopping them?
As grubbing-up fever crosses international boundaries – from France to Australia via California, we are faced with massive vine-pull schemes – the long and short of it is put down to a waning consumer appetite for wine.
Alongside protesting grape growers we are given the stats of declining wine sales – especially red wines – and dire export predictions and a swath of articles in which you can almost feel the skin chafing as boomers wring their hands with worry. What is wine's future if no-one is drinking it any more?
Except that's not really how we got here. A drop in demand doesn't help, of course, but it's not really why vines are being pulled up.
To open the door on this problem, let's look at the initial reaction of the new head of Bordeaux's wine trade body (the CIVB) to the proposed vine-pull scheme in July 2022. Back then, the incoming CIVB boss Allan Sichel (he of the négociant family business Maison Sichel) was keen to pour cold water on the proposals advanced by his predecessor, Bernard Fargues (a winegrower – the CIVB rotates presidents between vignerons and négociants) who had been tabling an uprooting scheme for some time.
Indeed, back in May, Sichel had taken the standard négoce position: sales and marketing was the issue, which is always the big issue for those dealing in bulk wine.
"I won't hide from you that at the négoce level several people are saying to themselves that there are other solutions, such as dropping PDOs [appellations labels] to go in the direction of other labels such as IGPs and VSIGs [Vins Sans Indication Géographique, or Wines Without a Geographical Indicator] that meet current demand," Sichel told French wine news website Vitisphere.com prior to being elected.
This is classic, big-company marketing-speak: appellations are a problem, there are other answers, etc. But the problem was clearly serious, even back then. So why such reluctance, a year and a half ago, to go ahead with a vine-pull scheme that made a lot of sense?
The real answer is that oversupply is exactly what major companies want. Those that buy-in large volumes of grapes or wines are more than happy for there to be more than enough of either on the market because, as should be relatively obvious, oversupply drives prices down. More vineyards than meets demand is precisely the climate in which the négociants thrive. It's a buyer's market and the buyer holds all the cards. As if to illustrate this very issue, it is the backdrop to the major recent ruling that found two Bordeaux merchants had engaged in unfair practices in buying wines from a winegrower at below cost price.
It's not just Bordeaux, either. In fact, one of the more direct accusations of just what I'm getting at came from Cognac late last year, when a frustrated local slammed the heads of the regional trade body (the BNIC), many of whom also work for major Cognac houses, for encouraging the excess planting of 15,000 hectares of vineyards in the region, which, according to a bit of on-the-fly accounting by the anonymous writer, reportedly accounted for the oversupply the region is currently experiencing.
Even in Australia, which has been keen to direct its oversupply issues towards China's doorstep (a trade war between the two countries certainly severely impacted wine exports), doesn't get away from the same problem. In a recent piece, national broadcaster ABC News talked to industry heavyweight Paul Clancy (inaugural chairman of Winegrape Growers Council of South Australia and the inaugural chairman Wine Grape Growers Australia), who had been ringing the alarm bell for decades.
"Mr Clancy said the big wineries that dominated the industry were winners from the oversupply because it drove grape prices down," said the paper.
Clancy himself penned a recent piece for Australia's Wine Business Magazine in which he was more forthright:
"I recall at the time when the vineyard planting frenzy peaked, one senior industry leader said: 'Don't worry, when the investors go broke, the vineyards will remain in the ground for the benefit of the industry.' A senior executive officer of a large wine company who has long gone was overheard saying: 'This oversupply should be encouraged – it will bring grape prices down'."
Clancy went on to slam the "glacial" response of the sector in the face of oversupply. A response no doubt tempered by those industry leaders and senior executive officers all too keen to keep oversupply up. Clancy argues that slight under-supply is the ideal setting for the wine industry – a position well understood, perhaps, in Burgundy, but not in the boardrooms of major wine marketing firms, négociants and brands (where much power resides).
Over in the US, where the boom-and-bust of unfettered business might be more of a foundational principle, there is less direct criticism. At a wine business event in Sacramento in January, the head of the Allied Grape Growers organisation, Jeff Bitter, urged the California industry to grub up 30,000 acres (12,000 hectares) of vines. He has made similar calls for the last four years but "nobody listens to me".
Bitter leveled no accusations but (quoted in Wine Business Monthly) said that, in a market of oversupply, "players" seeking opportunities rather than grape supply drove the market. Those players weren't named.
It's also other players who, in bid to make a quick buck, plant a big vineyard in Riverina and, when the going gets tough, abandon it to disease – a process that has direct impacts on all their neighbors, from depressing grape prices to spreading mildew. If you ever wanted an illustration of irresponsible short-term investment as being akin to a plague, I can't think of better.
So is it that the big guys are the problem? Well, maybe quite a bit. Of course, the négociants and major wineries will claim that in buying cheap grapes they are providing the consumer with cheap wine. But if this cheap wine is unsustainable for the person that grows it, how far are we from collapse? It's hard not to feel sympathy with protesting grapegrowers when it soon becomes apparent that the very thing they are contending with is their own customer (the person buying their grapes), who has been more than happy to help or encourage someone else down the road to plant a vineyard, or will simply buy wine from Spain, all under the guise of giving the consumer what they want, like they are doing the world a favor.
Some countries have an abhorrence of the R word ("regulation"), but some sort of national understanding is surely paramount. As Clancy points out in his piece, Australia still does not have a comprehensive, country-wide vineyard registry.
This is not helping the wine industry any more than it is by highlighting great value Rioja at six quid (USD 7.50) a bottle or that it is "made" by the latest C-list celebrity. Because wine commentators too have a massive blind-spot when it comes to cheap, négoce-produced wine (a category that much celebrity wine also falls into). They can, of course, point out a "bargain" Bordeaux to you, showing "amazing value" in a wine produced at a great price for the supermarket shelf but which has bankrupted the guy that grew it.
There's a tasteless appeal among more popular wine writers for this kind of thing – it is, admittedly, hard to escape – but surely we don't have to point people in that direction? Certainly we shouldn't when there is no mention of relative value (as if that concept suddenly vanishes among serious wine writers) when they review wines with a price tag of three figures and more. But I've gone over that ground before.
That doesn't mean négociants or major producers are "bad" – they simply do what makes sense to them and, of course, you’ll say that the quest (however noxious) for cheap booze is simply a function of the economy: people have less money, therefore wine prices need to go down. Well, only certain categories of people have less money. Others are doing very well, thank you very much. In fact, I'd argue the wine world – just like the economy – is on a two-speed race: one to the stars and one to the gutter, and there's very little in between. Just follow any major wine personalities on social media and you'll quickly see a disconnect with the real world.
I would posit that, if we wanted wine to recover worldwide, we would do better to elect governments on platforms of a better economic deal for the middle classes (wine's captive audience-in-waiting) than neo-liberal platforms in which, if wine is going to survive, it’s going to have to be berry-picked by trained thoroughbred chickens, then caressed by a fleet of masseuses prior to being fermented in gold-plated tanks and aged in oak taken from the hull of HMS Victory on a lend-lease program initiated by the cash-strapped British government, before being sold in hand-blown glass bottles for millionaires to forget about until the temperature on earth is so hot they find themselves taking a bit more time in their cellar.
But I digress.
Please don't just think the wine industry got here because consumers turned away from wine – bear in mind a recent study (Wine Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2023-2028) shows the global wine industry is expected to grow by over five percent in the next four years.
As I've pointed out, some members of the wine industry have been keener on the industry part than on the wine part.
Source: Wine-Searcher