High energy prices mean rising transportation costs, making it more expensive to get wine (and everything else) to market. This is compounded by lingering supply chain woes from the disruption of the pandemic. This hits smaller importers and distributors especially hard.
Europe was impacted by devastating frosts in April 2021 that severely limited the quantity of that year’s harvest. Frost is not unusual, but such a widespread effect across nearly all major wine regions is extraordinary. California and Oregon were hard hit by wildfires in 2020, and many wineries opted not to make wine for fear of smoke taint. These are wines that would be coming to market this year. Short supply means higher prices, and we may have trouble finding some of our favorite bottles. This shortage is temporary: The wine world seems much happier about the 2022 vintage.
These factors could lead to price increases of 10 to 30 percent this year, says Harmon Skurnik, president of New York-based Skurnik Wines, a prominent importer and distributor.
“For U.S. importers, the strength of the dollar certainly helps mitigate these forces to some degree, but the bottom line is that U.S. consumers will pay more this year for many wines,” Skurnik says.
These inflationary pressures will squeeze small mom-and-pop wineries and the independent importers and distributors who represent them. It will also hurt independent retailers and ultimately consumers, possibly chipping away at the variety we crave and enjoy.
Consumer consumption. A price hike of as much as 30 percent is pretty dramatic, so how will consumers react? We could cut out wine until conditions improve. Or we could buy less but at a higher average price. To oversimplify: If we buy three bottles a month averaging $20, we could change to two bottles averaging $30 to compensate for the price increase.
There’s also an increasing temperance vibe as we become more health-conscious, a trend magnified by the pandemic. Millennials and Gen Z are rebelling against — or not yet able to afford — the gluttony of their boomer parents. (Says this boomer.) An emphasis on moderation has led to the rise of Dry January, mocktails and a growing number of alcohol-free wines and spirits. We will see more zero-alcohol wines that actually taste like wine.
“People are buying less because they want better quality,” says Yannick Benjamin, owner and sommelier at Contento restaurant in New York City’s East Harlem and co-owner of the new Beaupierre Wines & Spirits in Hell’s Kitchen. “People have become more aware of what — and how much — they put into their bodies.” He attributes this to “the mindset of moderation and working according to nature.”
Packaging and labeling. We will continue to see more really good wine appear in box format. I’m excited to try Busy Signal and Dial Tone, a new line of wines from pinot noir maestro Adam Lee, the founder of Siduri and Clarice wineries. To be released this spring, the wines will be available in 750-ml bottles and three-liter boxes. The box format helps reduce the carbon footprint of transporting bottles and it can moderate the inflationary pressures mentioned above. That’s a win for the consumer and the planet.
I predict more wineries will change to lighter bottles, as a response to inflation, to reduce carbon footprint and adapt to climate change. More importers will bring wine in bulk and bottle it here, to lower cost and environmental impact. (Look for “imported and bottled by” on the label.) We’ll see more wines in clear bottles (easier to recycle) and without capsules over the cork (to reduce costs and waste).
We may also begin to see changes on labels. Under new European Union labeling requirements that just took effect, all wines sold in the E.U. — including U.S. exports — will need to show nutritional and ingredient information by early December. The U.S. agency that regulates wine labels is considering similar moves. This won’t be traditional labeling we’re used to on food products, but more like QR codes that link to the information on a winery website.
Such transparency should be positive and help meet the consumer concern Benjamin noted above for knowing more about what we put in our bodies. It could also take some wind out of the sails of companies boasting “clean” wines by implying that competitors contain unhealthy chemicals or additives.
That’s a lot to swirl and sniff. We’ll explore these and other trends throughout the year.
