The Wine Pulse at VinItaly
Too many producers are headed for disappointment
Going to VinItaly, Italy's biggest wine fair, is sort of like going to a good rock concert. It's a pain to get there. It's uncomfortable and overcrowded. But the entertainment is good, so it's worth the effort. I have been going since 1985.
VinItaly takes place each April in the beautiful city of Verona. Except that it's not actually in Verona, but rather in the fairgrounds on the outskirts of the city, where row after row of airplane-hangar–sized convention halls are stuffed with hundreds of stands of wine producers pouring their most recent vintages.
Thousands of people attend the fair, from wine merchants to journalists to curious consumers. Although everyone seems determined to taste wines, it might be one of the worst venues on earth for tasting. Nearly every wine I tried during a two-day visit was too warm. The wines tasted of alcohol and wood instead of fresh fruit and silky tannins. Many were barrel samples that hadn't been properly prepared, and the heat made them taste oxidized and flawed.
But it was still worth the trip—not so much for the tasting as for the talking. It's an opportunity to get a pulse on the Italian wine industry. I spoke to about 20 or 30 producers on my short trip, and one subject continued to come up in conversation: Sales are in a decline (or difficult, to say the least).
Italy is in for a rough ride in selling its wines, just like the rest of Europe, particularly France. Traditional European markets such as Germany have slowed to a standstill due to their weak economies. Even Italy is sluggish. The Far East has picked up slightly, but the volumes are small. And now the U.S. market is questionable.
The major problem with America is that the strong Euro has pushed up prices at every level of quality in Italy. And it doesn't look like there's any change in the future, even though the dollar strengthened about 8 percent in May. Most producers haven't increased their ex-winery prices for years, but the price increase due simply to currency fluctuations is about 20 or 30 percent.
The hardest hit are the best-known regions, where producers charge premium prices for their wines: Piedmont and Tuscany. It's hard to find many wine producers from those areas who are happy with their market at the moment, other than a few wineries that are well established in the U.S. with strong brand recognition or super-fair prices (usually in the range of $10 to $20 a bottle).
Some blame the exchange rate. Others point a finger at their importers. A few even say it's greedy restaurateurs or retailers who use unreasonable markups. However, I am afraid that a lot of these Italian wine producers only have themselves to blame—they are charging too much for their wines.
For instance, I was surprised to taste so many mediocre Chiantis and other wines at VinItaly that producers were happy to say were "only 5 or 6 Euros per bottle" from the winery. That's close to $7 and $8 a bottle from the winery, meaning they will be over $25 a bottle when they reach retail shelves in the United States, after all the distributors slap on their markups.
At first, I thought they were joking. I wouldn't pay five bucks for these thin and weedy wines at U.S. retail. I just told them that I hoped they weren't exporting these wines to America and walked away in disgust.
Then there were the hundreds of wannabe wineries at the fair whose wines have no market, either at home or abroad. I met one guy who didn't give me his full name—just "Guido"—whose main job was preparing raw land for vineyards in Tuscany. He told me that he had produced 15,000 bottles of the best 2003 Chianti Classico ever. "I even used 100 percent new oak barrels," he boasted, as if the use of new wood meant his wine was even better in quality.
"How are you going to sell the wine?" I asked.
"I don't know, but the quality of my wine is very good," he said.
"Do you have an importer in the United States?" I asked.
"No, but my wine is only 15 Euros a bottle," Guido said proudly.
With that, I politely said goodbye and walked away to another appointment.
As I looked around the Tuscan hall with hundreds of booths packed side by side with vintners pouring wines (many I had never heard of), I felt sort of dizzy. Where is it all going to end for the likes of Guido and his fellow Italian wine producers except in disappointment? I hope I am wrong.
Italians need to get back to what put them on the wine world map: producing honest wines for honest prices. Of course there is a niche for great wines at high prices, such as top Barolos, Brunellos and super Tuscans, but not everyone can fit into that market. And consumers, whether in Los Angeles, Frankfurt or Milan, are already making some Italian vintners understand this by not buying their wines.
