Tuesday, March 9, 2010

No wine should cost more than $39.88.

Fred Franzia stirred up a ruckus when he said no wine should cost more than $10. I am going to disagree with Fred. No wine should cost more than $40. Here is my reasoning.

Wineries pay $180 per ton for grapes grown in the San Joaquin Valley of California - California's largest growing area. The grapes are machine pruned and machine picked. Growers there get yields of 14 tons to the acre for a return of $2520 per acre. This is a fair return for this land which is mechanically mega-farmed in huge blocks. (San Joaquin Valley farmers measure the size of their farms in sections, not acres.) On the other side, grapes from the Napa Valley can fetch $4000 per ton. They are hand pruned and hand picked. Since production is often limited to two tons per acre, return per acre is $8000 for some pricey real estate. Cost of grapes per bottle: San Joaquin Valley $0.24, Napa Valley $5.33.

Cheap Chinese glass (lead may or may not be optional) costs $0.12 per bottle. Good European glass, the heavy landfill-special kind Bobby Parker likes, is $2.00 per bottle.

Good technical corks run about $.05. You can probably get straight agglomerated corks for $0.03. A two-inch number-one cork is about $0.77.

A PVC heat-shrink foil is around $.03 - maybe less by the millions. A good tin foil can run $0.23 from a top supplier.

Labels depend on quantity per run, but a cheap label, no foil, no embossing can be less than $0.03. That Woodinville label in a small-run with foil and embossing might be $0.78 or even $1.00 front and back.

There will be no cost for barrels in the cheap wine, but in the expensive wine in 100% new French oak, the way Bobby P. likes it, the barrel cost will be $4.28. Yes, you are drinking $4.28 of oak juice. I hope you like 2X4's.

Tax will be about the same for both wines, since the large producer will not get the small-producer credit and the small producer will go over 14% alcohol for the Wine Expectorator rating, so it is about $0.23 for each.

So the cost of the San Joaquin Valley non-vintage California schlock will be $0.68 per bottle and the cost of the Walla ultra-premium, hand-crafted, award-winning small-lot, high-alcohol (please hyphenate this BS on you promotional literature for proper grammar) fruit-bomb Washington Red Table Wine will be $13.64.

The winery has to make a minimum markup of 50% or 1.43. The Bakersfield wonder needs to fetch the winery $0.98. The ultra-hyphenated small-lot cab has to bring $19.50.

Standard distributor markup is 143%, so the San Joaquin Valley Hardly Burgundy goes to the retailer at $1.40 and the Napa Valley blah-blah-blah goes to the retailer at $27.89.

Standard retail markup is also 143%, so the San Joaquin wine hits the shelf at $1.99 or Two-Up Chuck. That's how they do it. The Parkerized wine in the landfill-special bottle hits the shelf at $39.88. Everybody deserves a fair profit for their efforts.

Is Fred Franzia making money on Two Buck Chuck at $0.98 per bottle? You bet he is. He is making full markup of $0.30 per bottle or $3.6 million per one million cases. Is the boutique winery making money on the $40 wine? You say, it looks like they make $5.88 per bottle or $70,523 per 1000 cases. (Let's make 2000 cases next year and double our profits!)

There is just one problem. $40 bottles of wine are not selling. It looks like they are rich sitting on $480,000 of inventory. Anyone want to buy a boutique winery? Inventory not included in the sale price.

If this doesn't convince you not to turn your garage into a winery, nothing will.

Saturday, March 6, 2010

Old Vintners Night

Whistlin' Jack Lodge hosts Vintners Appreciation Night each year in March. This year's event was held last Wednesday. It's a time when all the old winemakers can get together and reminisce. This year I sat with Leland and Linda Hyatt, Hyatt Vineyards Winery, John and Ann Williams, Kiona Winery, Paul and Marilyn Portteus, Portteus Winery, and Chuck and Claudia Fiola, Konnowak Vineyard, growers of fine Bordeaux varieties in the Rattlesnake Hills since 1983. The Prestons, Preston Winery, Randy Tucker, Tucker Cellars, and Scott Pontin, Pontin del Roza were there also. It amazes me that the Washington wine industry, which is so new, has forgotten its roots. Missing were John Rauner, Yakima River Winery and Mike Wallace, Hinzerling Winery. I wish they could have attended. They were dearly missed.

I learned that Mike Wallace, John Williams, Randy Tucker, and John Rauner got together back in 1981 to put together (with the help of Helen Willard, partner in Quail Run Winery) the petition to establish the Yakima Valley AVA, Washington's first AVA. They also formed the Yakima Valley Winegrowers Association. Bonair Winery was the 14th member to join in 1986. It was dissolved in 2005 when Steve Burns from the Washington Wine Commission got involved. Two competing organizations emerged, the Rattlesnake Hills Wine Trail and Wine Yakima Valley.

I learned something else. Most people don't know that Hogue Cellars made their first wines at Tucker Cellars. So many stories that have never been told. It makes me grumpy.

As usual, the party was excellent and the food outstanding - which it always is a Whistlin' Jack Lodge. (No, you won't read about it in the Wine Expectorator because the Wine Commission doesn't promote that part of the state. If it doesn't begin with W it ain't Washington Wine. X,Y(akima), and Z(illah) be damned.) The wine list is predominantly local from older established wineries in the Yakima Valley. What a concept. A great local restaurant with a local wine list. Blasphemy!

The next day, Shirley and I went skiing at White Pass. White pass is the local ski resort where the winemakers all have season passes. They have a high-speed quad, a quad, and two double chairs. They have a great day lodge that serves local wines (Blasphemy! I want California Chabbless!) and microbrews (they do have Bug Light on tap for people who don't drink beer). They also have a mid-mountain yurt. Next year they will double the size of the resort by opening Hogback Basin and a new mid-mountain lodge. The winemakers own private ski area!

We skied with Paul Portteus and John and Ann Williams. John used to be on the ski patrol, but is now retired, but his son Scott Williams still makes wine and patrols the slopes.

Back in the old days, all the winery owners knew each other personally. We all attended everything we could because there were so few of us and only a few main events. Many times I remember standing next to Jerry Bookwalter, Bookwalter Winery, and Mike Moore, Blackwood Canyon. Bonair Winery was alphabetically in the middle.

Those days are long gone. Even after 25 years in the state, most people have not heard of Bonair Winery. (Watch the video.) A lot of the thanks goes to Steve Burns and the Washington Wine Commission. Steve hated the Yakima Valley. It just didn't fit into his concept of what wine country should look like, e.g. the Napa Valley. He actually chartered airplanes (using our money) to fly people to Walla (which has some trees on the hills kind of like the Napa Valley) so they wouldn't have to look at the Yakima Valley. To this date, the Wine Commission arrives from the east, either Pasco or Walla and the furthest they venture into the Yakima Valley is Prosser, often stopping sooner in Red Mountain.

There are so many stories in the Washington wine industry, but the Wine Commission is so disconnected that these stories never are told. Stay tuned, I'm going to tell them and some people aren't going to be happy!

We can still be Friends

Does guerrilla marketing have a place in wine tourism? Back when we started Bonair Winery in 1985 there were fewer than 40 wineries in the state. We were the fourteenth winery to join the Yakima Valley Wine Growers. Those days are long gone. Now there are over 600 wineries in the state. We keep hearing the same old story from the Wine Commission,. "We must work together to promote wine tourism for the good of the state." In a larger sense this is true, although the Wine Commission doesn't think wine tourism is part of its mandate. But, the growth in the number of wineries has outpaced the growth in the number of wine tourists. Visits to wineries are down and attendance at events is down, not just because of the economic downturn, but also because of the saturation of wineries. Eventually, I think every garage in the state will be bonded.

The typical wine tourist can visit four or five wineries in a given day - probably no more than ten in a weekend. The Wine Commission represents all 600 wineries in the state, so the chances of them sending me a visitor is one in sixty. I wouldn't buy a lottery ticket with those odds. (Well, maybe I would. I think that is better odds than the Washington State Lotto.)

Wine Yakima Valley represents about 50 wineries, so the odds of being selected become one in five on a given weekend. The problem with Wine Yakima Valley is, they cover a wide geographic area from Naches to the Tri Cities. This wine tour is 100 miles long.

Bonair Winery belongs to the Rattlesnake Hills Wine Trail which requires its members to be no more than two miles from the AVA border. All 17 member wineries are within 20 miles of each other. I like to compare it to shooting starlings on a wire above the vineyard. If they are close - which starlings usually are - I can get five with one shot. If there are 600 starlings on the wire, I will kill 1 out of 120. The rest will fly away. If there are only 15 starlings on the wire, I will kill one in three, pretty good odds of getting hit.

How does this relate to guerrilla marketing? Since the number of wineries has outpaced the number of wine tourists, the Rattlesnake Hills Wine Trail resorted to 'unfair' (as one of our non-members said) marketing practices. (Note: All wineries were invited to join at the formation of the Wine Trail.)

For those of you who don't understand the concept; 'unfair' and 'marketing' don't belong in the same sentence. Think of the recent spat between AT&T and Verizon Wireless. Verizon showed a map of their 3G coverage compared to AT&T's 3G coverage. AT&T said the map was 'unfair' advertising because it made it look like AT&T didn't have coverage in most of the US; which it does, just not 3G. A judge decided that 'unfair' and 'advertising' don't belong in the same sentence. The idea is to gain market share against the competition anyway that is legal.

What were the 'unfair' marketing moves made by the Wine Trail? First, we came up with a passport that gave benefits and prizes for visiting 10 of our then 15 members. This encouraged visitors to stay in the area and only visit member wineries in the Rattlesnake HIlls. Secondly, the Wine Trail formed an alliance with the three local cities and formed a Tourist Trail to keep people in the area and promote tourism in the cities as well. Maps were erected in the cities and only member wineries were on the maps because the maps carried the Rattlesnake Hills logo. All hell broke loose. But if you choose not to join an organization, why would you expect them to promote you on a map with their logo?

The Rattlesnake Hills Wine Trail has as its main objective to bring people to our tasting rooms. Our brochures are available all over the state on ferries and at freeway rest stops. We work closely with the Yakima Valley Visitors and Convention Bureau to promote tourism in the region. The visitors center sells our passports in a mutual agreement that helps both organizations. Since some of our member wineries do not produce wines from Rattlesnake Hills grapes, we do not market the AVA as a growing region.

I may be a curmudgeon, but I'll work with you if you have a plan to increase tourism overall, but I am in the wine and tourist business. To stay in business, I need to succeed. To succeed, I might eat your lunch or try to take more than my share of the pie. Is that fair? No, it's business.

Friday, February 26, 2010

EPA Makes SO2 a RUP!

The Washington State Department of Agriculture (WSDA) just sent every winery in the state a letter stating that the EPA has classified SO2 as a restricted use pesticide. This means that the product must have a registered label with the EPA and a registered label with the state of Washington listing which uses are permissible in Washington State. (No SO2 label is currently approved in Washington.) It also means that to purchase SO2 you must possess a pesticide applicators license. To sell it you must have a sellers license. This is going to make a lot more Grumpy Winemakers in the state. Welcome to the club!

First of all, to get an applicators license you must take a very hard test with questions like "the bandwidth of your spray nozzle is 18", your flow rate is .05 gallons per minute, your application speed is 4mph, and your formulation is 50WP. How much of the formulated pesticide will you add to 50 gallons of water to apply 4oz per acre active ingredient?" This is something farmers do all the time in their heads, but not winemakers.

The second problem is compressed gas is sold by OxArc or other welding supply stores. Farm pesticides are sold by Bleyhl Farm Service or other Ag Chemical dealers. Would it be important enough for a welding supply store to hire an ag chemical specialist just to sell an occasional cylinder of SO2 to a winery?

I would expect you to think that the Grumpy Winemaker would be even grumpier over this. Well, that isn't the case. The first reason, I am a farmer, a grape grower to be specific, and have a Private Pesticide Applicators License. I can buy this crap legally today, but I'll bet a lot of urban, strip mall, warehouse, truck stop, or airport wineries do not have a pesticide applicators license. Study hard, dudes, the test is not easy and you have to score 70% or above.

The second reason I am not grumpier is that at Bonair Winery, we do not use compressed SO2 gas. Only wineries with ozonators use this method to preserve barrels. We use the old-fashioned method of burning a sulfur wick in the barrel. Not only does this method add SO2 gas to the barrel, it consumes the oxygen to produce it, giving you an oxygen-free barrel filled with SO2.

To add SO2 to wine, we use Potassium Metabisulfite. So far the Obama EPA hasn't made it a restricted use pesticide. If they do, that will be a real problem for restaurants, since they sprinkle this stuff freely on the salad bars to make them last a month.

I suspect one manufacturer is behind this. Only one product is registered with the EPA and they convinced the EPA to make the listing so they could make a killing. That is how government 'helps' business.

I wonder how this will affect California wineries? Restricted use pesticides are pretty much verboten in the Golden State.

Sunday, February 21, 2010

Bad Bloggers

If you think wine writers make me grumpy, some bloggers are worse. At least wine writers have copy editors to keep their facts straight. None of this is required for bloggers. In fact, most blogger lack rudimentary writing skills.

But wait, I can live with poor writing, but poor knowledge of wine is unforgivable - if you are writing about wine.

For example, this blog appeared on Cellar Tracker. "Tasted by pnwsun on 1/17/2010: was looking for a buttery chard; this wasn't it. the description mentioned a buttery taste but we didn't notice it. nice wine but tasted more like a sauvignon blanc. a mineral aspect with slight fruit at the finish. (62 views)"

Anyone that would confuse this wine with a Sauvignon Blanc does not know much about Sauvignon Blanc. Since the wine in question is oak aged and 100% malolactic, it would even be hard to confuse it with a Fume Blanc. The bottle screams chardonnay. Yes, Chardonnay can have a minerality, but not this one. What I really suspect is that this bottle was corked and this blogger does not recognize TCA. A corked wine will have diminished fruit. This wine is bottled with a technical cork (Twin Top) which has less incidence of TCA than natural cork, but we still get about 1 in 500 with TCA.

Then there is the picture of the label. It shows Bonair's old 'Reserve' label which hasn't been used since 2005. The wine in question is the Yakima Valley label, not the 'Reserve', and retails for $9.99.

The 'Reserve' label was replaced in 2006 by the Rattlesnake Hills Estate Bottled label. The wine commented on is not the replacement for the old 'Reserve' Chardonnay. The Rattlesnake Hills Estate Bottled Chardonnay retails for $20. This wine is barrel-fermented in Burgundian (Bill Gates' spell-check thinks these should be Burundian Barrels, but I think Microsoft is wrong. Bill Gates can drink Burundian wine, I'll stick to Burgundian.) barrels imported for Burgundy each year made from the forests of Vosges. This wine most nearly resembles the great Meursaults of any non-French wine.

With the internet, everyone can be an expert. But that doesn't make them right.

Friday, February 19, 2010

Rating the Raters (cont.)

The Wine Advocates (Robert Parker, et al) 80/0. I subscribed to this newsletter for a year, but didn't find much, well, news. It was the same old stuff everyone else was rating and a lot of stuff not even available in this area. (Wine country is, how can I say it, in the country, the boonies, where we grow grapes. We are like hick farmers. People in Walla and Woodinville make fine wine. Grow your own grapes and make wine? Nonsense.)

Maybe I should invite Jay Miller to our finest hotel in Zillah Zillah, the Comfort Inn, and wine him and dine him. It seemed to work for Argentina.

It is hard to believe Robert Parker can be so influential in the wine industry to the absurd point that you can submit samples of your wine to a lab and they will tell you how to 'parkerize' it. I don't think it is a big secret - lots of new French oak (up to 200%), overripe fruit, low (soft?) tannins, and high alcohol. Varietal character? What's that? Aren't' all wines supposed to taste alike?

This newsletter is for collectors, like my friend Jake who collects steaks. He has steaks from all over the world. Steaks from Kobe beef from Japan, Chianina beef from Italy, grass-fed beef from Montana, and grain-fed beef from Kansas. (No beef from the Harris Ranch in California.) He doesn't collect any ordinary steaks like sirloin or round, mostly filet mignon and rib eye. He does have one New York steak. I think it is from the Finger Lakes. He even has a rare 1961 Limousine steak from France.. He keeps his steaks in a climate-controlled cabinet. It looks a lot like a freezer to me. I asked him what his favorite steak was and he told me he is a vegetarian and doesn't eat meat He just collects steaks and uses them to impress his friends. Just like a wine collector, you say.

So, there isn't much here for wine drinkers. Jay Miller, who rates Washington wines, didn't even find my last submission worthy of his palate. Just so many wines and so little time. Eew yuck, an estate-bottled wine. How provincial.

So, we finally have our first 0 (yes, Virginia, that is a zero.)

Thursday, February 11, 2010

Rating the Raters (cont.)

Wine Spectator 82/2. The content of this rag is somewhat more interesting than the Wine Enthusiast, but I am not rating content, I am rating the raters. I find reading about restaurant awards for nonexistent restaurants quite entertaining.

The recent flap over naming the 2005 Columbia Crest Merlot, the wine of the year, makes one wonder about the quality of their ratings of wines. Don't get me wrong. Columbia Crest makes fine wines and I am happy that our largest producer is a quality producer, not one known for its "Hardly Burgundy." I am pleased a Washington winery won the award. I am not familiar with the wine in question, so I can only go with those who keep copious notes on such things. Paul Gregutt, for one, questioned the choice of wine - not the winery.

I just glanced at the February issue looking for the big Columbia Crest full-page ad. Didn't see it, but I did notice that the "Wine of the Year" 2006 version dropped to a 90. A full-color inside back cover might have helped that score.

What also makes me wonder, and a little Grumpy, is that in 25 years they have never reviewed a wine from Bonair Winery. We have a whole page of awards from everywhere else. Why has Bonair not been reviewed? I know we have submitted wines for review. Perhaps they have a preconceived notion of what's good and what's not. Only wines that someone else thinks are good get reviewed.

But wait, on their website they state "Our goal is to review wines that are important and available to our readers. In most cases, we review only wines that are distributed in major markets in the United States." I get it, only major schlock is reviewed. Most Northwest wines do not have distribution in major markets. To meet this goal, the winery must be 100,000 cases or larger. Also note, that the "Wine of the Year" was sold out at time of publication and not " available to our readers".

They say they use a committee for judging wines and it is a blind judging. Japanese cars used to be designed by committee. The result is something no one likes or can predict.

This magazine basically rates grocery store wines with a few boutique wines (read: wines you'll never find) thrown in for glitz.

So, I can only give the Wine Spectator a 2/20. Not very good for a major wine rater. Maybe wine bloggers aren't all bad. They certainly fill in a void for Northwest wines. The ratings for Northwest wines in the February issue was pretty sad, considering there are over 600 wineries in the state.

The Grumpy Winemaker won't be submitting any more wines to this rag.

Note to self: don't renew subscription.