Skeptical Wine-ing, Part I: Wine Pricing
Last month, the NYT reported that wine dealer Rudy Kurniawan was convicted of fraud after successfully passing off regular wine he’d mixed in his kitchen as sought-after, top-end bottles. This man swindled wine collectors out of large amounts of money, made a mockery of those who are supposed to be able to catch these things, and raised an obvious question: What is the difference between his own mixed-up bottlings and top-end wine? Did his success in passing it off reveal wine hierarchy––and pricing––to be a huge scam?
According to many comments I saw from strangers and friends outside the wine industry who read and shared the article, he’s a hero. He showed the world that the emperor––the almighty wine industry––has no clothes. He proved that there’s no difference between Two-Buck Chuck and the most expensive wine in the world (currently that title goes to a special-edition Balthazar, or three-gallon bottle, of 2009 Château Margaux, which at $195,000 comes with a trip to the Bordeaux winery). He’s the Robin Hood of the wine industry.
Having worked in the wine industry since 2009, I’ve seen my share of fraud. I’ve seen wineries boast that their sub-par wines are “medal-earners,” knowing that gold medals from festivals are a dime a dozen. I’ve watched Dr. Oz tell the world that only the wines of Sardinia, eaten with a hunk of Sardinian cheese, will offer them the heart-protecting benefits of antioxidants, and that their beloved malbec simply won’t do the job. I’ve seen wine labels advertise “organic,” “biodynamic,” “no sulfites detected,” and “sustainable,” and I’ve seen that public interpretation of those labels isn’t always accurate. I’ve seen customers ask incredulously why I’m recommending a wine that received 89 points (from whom, it doesn’t seem to matter) when there’s a 90-point wine right next to it on the shelf. I’ve poured cabernet franc for tasting room customers who responded with a snarky, “Cab franc? I don’t really expect greatness from cab franc,” seemingly assuming I wouldn’t recognize it as a line straight out of the movie Sideways.
Do I think the wine industry is out to swindle us all? Do I think we should all take our jugs of Carlo Rossi and heave them through the windows of the American Wine Society? No. I don’t believe in Big Corkscrew. But I do believe in the possibility of getting screwed over, and I think we wine people (I’ve worked as a tasting room associate, cellar hand, wine writer, wine retail associate, and bartender, and I currently blog about wine and my own winemaking efforts––shameless plug) need to do a better job of making the beverage we love a little less confusing. In a series of posts over the next few months, I’d like to put my obsession with wine science research to work explaining some of the most common wine misconceptions and controversies. My goal? To make the point that wine needn’t be mysterious to be romantic and fun, anymore than science need be clouded by “wonder” in order to be awe-inspiring.
In the spirit of Mr. Kurniawan’s con, let’s start with wine pricing. Is there any difference between his mixtures and a $5,000 Bordeaux? What makes those wines so expensive?
I find it helpful to think of wine as food, since in a way it is. You have your Wonder Bread, and you have your 12-grain Health Nut. Just as you have your moderately priced California chardonnay, your $300 Super Tuscan (best-named wine style ever), and your Little Black Dress pinot grigio, you have your saffron threads at $15 a jar and you have your basic all-purpose flour. You have noma and you have McDonald’s. In theory, more expensive wines offer what more expensive meals should offer: ingredients grown with care and sourced thoughtfully, made well, with a bit of a story perhaps, all culminating in a more memorable experience than your average PB&J or Franzia.
The trouble is that Franzia is still a luxury item, because wine isn’t a basic human need (and that’s coming from a writer) in the same way that food is. So spending a lot on wine tends to grate on us a little more than spending a lot on food––we have to eat, right? It just depends what and where––and, yet, a single bottle of wine is at minimum the cost of a food truck lunch and at most a down payment on a house. So we have a lot more variation, a wider swing, a higher starting point, and less knowledge about what we’re actually paying for. Add to that the perception (and to some extent, the reality) of wine enjoyment as a “bougie” enterprise thanks to the free time and disposable income required to learn about it, and it’s easy to understand why discovering inexpensive yet delicious wine feels like cheating the system.
Nutrition is confusing enough, but most people know more about how a sandwich is made than how wine is made; we prepare at least basic food for ourselves every day. Here’s a rough summary of what consistently goes into the price of a wine:
The price of the grapes. This is huge. Some wineries grow their own grapes on-site; others buy them from vineyards of their choice. Either way, land in well-established wine regions is anywhere from expensive to impossible to obtain and a particular site has a huge influence on the flavor, quantity, and quality of the grapes (that’s its own book, but I’ll get into it more in this series). A good viticulturist or vineyard manager will coax the best possible grapes out of the vines––battling weather threats like hail, frost, and sun damage, as well as pests, hungry animals, and diseases––and they have to pay a team of workers to help maintain the vines in season and pick the grapes or run the harvesting machines in the fall. Wine labels often spend a lot of time focusing on the location of the vineyard; wine is supposed to express its “sense of place,” and it’s widely accepted in the wine industry that “wine is made in the vineyard”––the frequently added winemaker’s motto is “so just don’t mess it up.”
Lower-quality fruit can be sweetened, acidified, blended, and/or manipulated with various enzymes, additives, and winemaking procedures to produce the ripe, fruity, juicy character most people want in an inexpensive wine, which is why many people will say they think Yellow Tail Shiraz tastes better than a $100 aged French wine: they’re used to wines made to taste like “more” of everything––more alcohol, more fruitiness, more tannin from the grape skins––just like fast food cranks up the salt and sugar and fat to 11 so it’ll satisfy cheaply. And just as I will go headfirst like Pete Rose into a large order of fries and a Wendy’s Frosty on occasion, I will happily drink many brands of cheap wine. It’s all about mood and setting.
The time, equipment, and labor needed for production. Sorting the grapes! Pressing the grapes! Fixing the grape press! Ordering a new grape press from the Germans and hiring a German engineer to come out and show you how to use it! Aging the wine in oak barrels, which aren’t cheap and can only be used about four times! Wine equipment is big and expensive and breaks down and often takes a long time to do its job. The time between the harvesting of the grapes and the bottle landing on your local store shelf is anywhere from six months to five years or more (many world-renowned wineries can afford to hold, and age, their wines several years before release, as I’ll discuss in a future post on aging wine). What’s in your bottle has to pay for these things.
The salary of the winemaker, the winery team, and probably the owner. It’s been said that the best way to make a small fortune in the wine business is to start with a large fortune. While owners are often wealthy (celebrity forays into wine abound), you don’t typically see winemakers buying yachts and second homes in the Caribbean. But they have to eat, and the best ones in the world are staking their reputations and careers on something that’s highly influenced by weather in an increasingly unstable global climate. They deserve to charge for this, and they do. Their team will put in hundreds of overtime hours during harvest season, when wine cellars need attention nearly round-the-clock. (That said, labor cost is a huge conversation in the wine world right now; stay tuned on that.)
Then there are several X-factors. Here’s where we really get into the realm of “wine mystique,” and where I’d like to spend the rest of this discussion.
The grape or grapes involved. Thanks to Sideways, everyone knows that pinot noir is delicate, sensitive, heartbreaking, and so many stereotypically feminine metaphors. That means you can charge a lot for a bottle of pinot. It’s not easy to find a good one under $20. Blending generally takes extra time and risks, so blends are often more expensive than single-grape (the term is “varietal”) bottlings, but with the rise in popularity of “kitchen-sink” blends like Apothic Red and Red Truck, which assume that the consumer doesn’t really care what’s in the blend and just wants a smooth “table red,” that’s changing. When discussing what to charge for a new wine, the grape varietal always comes into the discussion. People are more willing to pay for certain grapes than others, and some grapes are legitimately harder to grow or harder to find. You can get a great Finger Lakes riesling, New York’s signature wine, for $13, but expect to drop considerably more for something like Red Tail Ridge’s delicious teroldego ($40) in part because it’s a rarity in the Finger Lakes. Many wine geeks, myself included, simply can’t resist trying something unfamiliar or rare.
Scarcity. If only 50 cases of your reserve riesling exist in the world, you can charge more than you do for your everyday riesling of which you have 500 cases. The most expensive wines in the world are also some of the rarest.
Vintage. The weather and factors like animal damage and disease contribute to every growing season; if you had a summer full of sunny, hot days that lasted well into October, your friendly neighborhood vines, particularly the reds, had a great year too. Vintages are rated just like wines, and fantastic vintages bring fantastic quality, and accompanying prices. However, a great vintage means middle-of-the-road producers can often make unusually stellar wines, and those will be cheaper because of the lack of name recognition; by the same token, in poor vintages great producers will often still make great, though slightly cheaper, wines. Both circumstances result in values for us if we’re willing to do a little homework!
Specificity of the label. The more specific the information given on a wine label, generally speaking, the more a winery can charge for it. This is because certain designated regions, American Viticultural Areas (AVAs), and even vineyards or “blocks” (sections) of vineyards are thought, or shown through analysis of the soil, climate, and finished product, to result in a distinct flavor or character in wines; it’s like a great musician in a band getting a chance to do a solo. Make a single-vineyard wine, and you can charge for both the specificity and the extra work involved in nurturing its unique character with an individualized winemaking process (separate fermentation, separate aging, etc.). Make a single-vineyard series, and you can give tasting room guests a chance to try them all together and experience your region’s diversity.
The prestige of the region. Why is it relatively easy for me to sell a customer a $50 Bordeaux blend, but selling a $25 South African wine made with the same grapes requires me to deliver an impassioned monologue? Because Bordeaux and Burgundy are the historical king and queen of the French wine industry––and, thus, the king and queen of the wine industry itself. (That said, you can find good inexpensive Bordeaux, it’s just not as easy to find as rather boring inexpensive Bordeaux.) This is one of the reasons I love Italian wine: for all the country’s wine history, wine-drinking culture, and prestigious producers, I can walk into most wine stores and find a dynamite Italian bottle for $12 to bring on a dinner date.
The prestige of the producer or brand. Just as any company builds up a reputation for its products, wineries can build up reputations both within the wine community and in the general public. Yellow Tail has brand recognition––love it or hate it, you know what you’re getting. Certain California brands like Cakebread and Plumpjack have brand recognition among a certain type of monied wine drinker, and anyone who’s been a fine-dining server has seen the result. Cheval Blanc, a storied Bordeaux producer, made it into both Sideways (in which Paul Giamatti’s Miles seems to forget that it contains his two least-favorite grapes, merlot and cab franc, as he rapturously sips it from a styrofoam cup) and Bottle Shock, and big Tuscan names like Sassicaia and Ornellaia have achieved legendary status among collectors. Their price tags reflect it.
Presence of organic or biodynamic certification. Thanks to the popularity of organic, “GMO free,” “free range,” and similar food categories and classifications, people are familiar with––and seek out––organic wine, and aren’t surprised when it’s more expensive. Biodynamic is generally perceived to mean “super, SUPER organic” by those who aren’t familiar with this very specific certification (it’ll get its own post in this series, of course).
So what about Kurniawan and his wine-mixing? For starters, he wasn’t passing off Black Box as Romanée-Conti; he was a renowned dealer in the industry, so he knew the wines he was faking. It’s plausible to me that if you mix together high-end but not top-of-the-line wines in enough different combinations, you could get something that might, at least on initial sipping, pass for a classic. Still, the NYT reported that it was questions from suspicious buyers, as well as a couple of careless historical inaccuracies, that initially cast doubt upon the wines: “A 1947 Burgundy lacked the ‘unctuousness’ one would expect from a great wine. And the 1961 Petrus seemed ‘a little young.’” It’s impressive that the differences weren’t more obvious or immediate, but tasting wines by themselves––as opposed to in a flight with others of similar value, vintage, or producer––is extremely difficult. Next time you have the opportunity to attend a wine tasting, say, at a local wine shop or coffee house, try several wines next to each other, and if you pay attention I bet you’ll notice differences between them. But could you recognize just one of them, alone, in your glass six months later? I know a lot of people who are great at blind tasting, but even then it’s rare to see someone identify a wine down to a specific label, especially if they haven’t had it before.
I’ve neither had the enormous personal wealth nor the connections required to amass a cellar of the kind of wines Kurniawan was dealing––they cost thousands upon thousands per bottle and many aren’t even available to the general public. I have, through my various wine jobs, had the opportunity to try thousands of great wines, including a few at the high-end level. (For those of you who care: 1989 Château Haut-Brion, a couple of 2003 Guigal “La Las”, a 1995 Kanonkop Paul Sauer blend from South Africa, and a 1999 Louis Jadot Gevrey-Chambertin would top my “don’t see that every day” list.) Based on that experience, here’s what I think.
There are perfectly good wines out there for $6. There’s also a lot of crap at that price, but hey, you’ve only spent $6. There’s a quality jump between sub-$10 and $15 that I think most people would agree exists, if given a selection of such wines of the same grape to try side-by-side. Going up doesn’t guarantee quality, it just gives you more options and a better chance of finding something awesome. There’s another quality jump to the $30–$50 range; with a little research and advice or luck you can find truly amazing, memorable bottles in this range. After that, it becomes very, very difficult to guess a wine’s price. That ’89 Haut-Brion? Magical. Poetic. Nuanced and graceful and just lovely. But not the best wine I’ve ever had. That honor goes to a $300 Tuscan wine from Casanova di Neri that my friends didn’t even think was all that astounding––wine enjoyment, like food enjoyment, is to a large extent subjective and based on memories, mood, taste, and context. But it spoke to me, and I can still taste it, years later. If I had to pick a third, it would be a five-way tie between wines in the $30 to $50 range.
If I won the lottery, I might buy one bottle of Romanée-Conti just to see what all the fuss is about. But then I’d fill up the rest of my shopping cart with wines $50 or less from around the world, rather than a handful of “priceless” classic bottlings, because based on everything I’ve tasted I think I’d have much more fun that way.
But that’s just me. Wine is personal, and I don’t begrudge anyone with the means the chance to feed their passion. I do think this case merits a closer look at just how much faking there might be at the highest level of wine dealing––but as a journalist, I’m also very aware that for most people this seems like a total nonissue because we’ll never get to taste these wines. One of Kurniawan’s lawyers said he’d been “singled out,” that the case reflected the “don’t ask, don’t tell” nature of the high-end wine trade, and it’s an interesting choice of words: a shroud of mystery has always ensured that the world’s best wines were only accessible to a select few. Now that millenials are more interested in wine but not necessarily the wine critics, points, or pretentious cellars that have always come with it, the knowledge barrier may be slowly––slowly––chipping away, and while the highest-end wines may still be out of reach, that doesn’t mean a very exciting and diverse world of inexpensive to moderate wines isn’t worth taking the time to research and explore.