mdg
7193
There is a back story here not necessarily related to the current pandemic...
Apr 02, 2020,12:06 PM
...my family has owned property in the Napa Valley for the last 60 years. We operate it as a vineyard (we grow grapes) with no winery on the property. For various reasons, in the past two seasons there has been a HUGE (some say unprecedented) glut of grapes. That includes Cabernet. As an example, we made the decision to rip out 4 acres of Cab this past fall as the price to farm it didn't pay for itself.
This seems to be a cycle that may last ten or more years. Part of it is consumer-driven...tastes change...hard seltzer, craft beer, legal marijuana, the rebirth of cocktails...all play a part. As does the growers who planted too many vines. It was all well and good when people were consuming wine and happy to pay $50-100 per bottle. But when habits changed, those kinds of prices were no longer realistic.
As for how the pandemic affects distribution, I agree that there will be a shift. Successful wineries already have 'Club' memberships in place where wine is delivered once or twice per year. That is obviously good for the business as they have a built-in, guaranteed revenue stream. But the pandemic part is killing them too as a big part of their revenue and marketing efforts comes from their tasting rooms which are now empty.
Wineries and growers have been under a lot of stress these past couple of years without this extra pressure. This will probably tip many smaller operations (my family possibly included) over the edge. So just as oil is cheap and reserves are being filled, this is a very good time to start looking for really good wines at really good prices. Drink up : )