In three separate conversations with winemakers and other winery professionals over the last two weeks, I have heard that there is a pretty dramatic oversupply of wine coming from our nearby wine regions. The comments came in three different forms, but all pointed to the same problem for the wine industry close to home in Washington and Oregon, which leads me to believe Idaho is suffering from similar ills.
A producer of premium Willamette Valley Oregon Pinot Noir told me point blank that his winery is cutting production from 10,000 cases annually back to 7,000. The main guy at a prominent Columbia Valley, family-owned growing operation and winery stated that they, and most of the growers in Washington, will be “dropping fruit” with this vintage because there is too much wine being made in the state and no markets to sell it to. And finally, a winery sales rep tasted me on a new string of wines with a new label from an existing winery that the winery introduced to alleviate the over-supply of past vintage wines that they have not been able to sell. She further explained that past vintages are lined up waiting for release with no plan on how to sell them or who to sell them to.
All in all, this paints a pretty bleak picture for wineries in the Northwest. It also confirms something I have suspected for some time. Simply put, you can’t acknowledge and confront an oversupply of wine, or for that matter an oversupply of any product, without taking a long, hard look at your pricing. This to me is the root of the problem for Northwest wines; they are simply getting too “spendy.”
The conversation is the same with grape growers or winemakers — for every extra dollar you pack on your bottle of wine, you must consider “who” you are drawing into the conversation. Many factors are contributing to this endless, upward spiral in pricing for Northwest wineries. From aggressive minimum wage increases and family leave policies, to regulation of the businesses themselves and taxation — all are a factor in driving prices higher. Add in a dose of pride that producers in the Northwest feel for their end product and you end up with wine prices that rival some of those who have been in the business of making and selling world-class wine for decades (in the case of California), or centuries (in the case of Europe).
Add into this mix some pretty compelling values coming out of new-world appellations in South America, New Zealand and Australia and the distressed producing countries of Europe, and it’s little surprise that the demand for Northwest wines is dropping.
As winemakers from the Northwest attempt to open new markets around the country and overseas, they are up against the same and even more competition. If you are assembling a collection for a shop or restaurant in New York City which has some of the most sophisticated consumers anywhere, what do you think will sell better at the $100 price point — a Cabernet from Napa or one from the Northwest?
There are no quick or easy solutions to these challenges for wineries in our home area, but it is a challenge that better be met forcefully and quickly. It is simply not sustainable when you have any winery in Washington, Oregon or Idaho expecting prices like those from the best producers in Napa and Sonoma. Regional pride or not, the choices become stark when you think about a Washington winery asking the same amount for their Zinfandel as legendary California Zinfandel producer, Ridge Vineyards. Paul Draper and Ridge virtually established the varietal as the quintessential American wine grape; they have been producing top rated delicious “Zins” since the ’70s, challenging their pricing from an appellation that is not even suited for growing Zinfandel is in short folly.
Similarly, you can find a long list of Pinot Noir from the premier regions of Carneros and the Russian River Valley for 50 cents on the dollar compared to some fairly mediocre wines from the Willamette Valley in Oregon. In all of these discussions you will find consumers who prefer a Washington Zin over one from California and those who would rather have Oregon Pinot Noir, but it remains for every dollar above any other wine you are bringing more competition into the buying decision. Before you know it, vintages start to back up and wine is not sold, leaving an oversupply that becomes the topic of wine professionals when they get together over a glass of wine.
If there is a topic you would like to read about or questions on wine you can email George@thedinnerpartyshop.com or make suggestions by contacting the Healthy Community section at the Coeur d’Alene Press.
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George Balling is co-owner with his wife, Mary Lancaster, of the dinner party, a wine and gift shop in Coeur d’Alene by Costco. The dinner party has won the award for best wine shop in North Idaho twice, including for 2018. George is also published in several other publications around the country. After working in wineries in California and judging many wine competitions, he moved to Coeur d’Alene with Mary more than 10 years ago to open the shop. You can also follow us on Facebook at http://www.facebook.com/#!/dinnerpartyshop.