Photo: wharman (Flickr)
France Vs. Italy
Is France’s wine bubble about to burst?
According to the European Commission, last year Italy produced 4.96 billion liters of wine, compared to France’s 4.62 billion liters. That’s a one percent drop in production for France compared to 2009, and now makes Italy the world’s largest wine producer.
Italian production and exports of the sparkling wine prosecco outpaced Champagne output by 20 billion liters. This is even with France’s substantial vineyard territorial advantage.
Bordeaux To The Rescue
But there is good news for French wine makers: bottles of 2010 Bordeaux wines are selling quickly. Reviewers are calling the wine exceptionally good.
New Bordeaux wines are released once a year and are often priced exorbitantly high (close to $100 a bottle for a 2010 vintage).
Part of this has to do with scarcity: Bordeaux wines are only released once a year, and the competition for a bottle of the best stuff is high.
Another part is production. These wines are made with grapes from 100-year-old vines in historic vineyards which are plowed with horse-drawn carriages to protect the soil. They’re grown in exacting climate and environmental conditions.
Buyers are willing to pay top dollar for all of that, especially in the Asian market. It’s estimated that only a few hundred buyers in China make up the largest portion of the wine demand.
Riches In The Wine Cellar
But American wine critic Robert Parker, who warned French producers to be more modest with pricing of this year’s release, thinks that if costs keep escalating, buyers will disappear. In this economy, he says losing a few buyers could lead to a collapse of the market.
However, Asian buyers see wine as an investment, like gold. The continent is now the leading export buyer of Bordeaux.
Sam Gleave of the Bordeaux Index told London’s The Guardian that it’s only the top one percent of Bordeaux wines that are seeing this price surge. The ones at your local wine store are seeing steadier prices.
“The only thing that really affects prices at the mass-produced end of the market is exchange rates,” he says.