Saturday, September 3, 2016

The 1988 Wine Crisis or We Have Too Damn Many Wineries

The purveyors of doom were at it full bore in 1988 - long before most of today's winemakers were even born or at least, were still wet behind the ears. There were a whopping 70 wineries in the state - up from 11 in 1977. How are we going to deal with so many wineries?
Washington was still number 3 in production behind California and New York. Production was up 68% over the previous year, but consumption was only up 11%. Out-of-state wine sales were flat and national consumption was down 3%. Man, that sucks.
Simon Siegl, president of the Washington Wine Institute, was optimistic. In-state sales were up 17%, but out-of-state sales were up only 4%. He stated that we are undermarketed. We probably still are today with over 800 wineries in our tiny state.
F. W. Langguth, one of the larger wineries, was on the ropes with Chapter 11 due to oversupply of grapes and under supply of sales. They also had problems with trying to make German-style Riesling in Washington State. They actually found grapes at the end of October that were still just 18 brix (just like Germany) due to severe overcropping. Unfortunately, they had enough acid to rejuvenate a car battery. The wine was undrinkable.
At that time, there was no mention of Woodinville, only real wine country; Yakima, Tri-Cities, and Walla Walla.
Premium wine was that which cost more than $4.00 per bottle. It didn't hurt that our largest, and best distributed brand was in that premium category and available in a "couple dozen" states. No Hardly Burgundy or Chabless here.
So, perhaps my glum outlook on the industry is premature after all. 28 years later, the industry is just fine and still growing. Most of the wineries going out of business are doing so because there is no market for used wineries and the owners are tired of being rich winery owners.
So, I guess all we need is a little more out-of-state marketing.
You can read the whole article here complete with quotes from Stan Clarke.

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