Regenerative organics picks up speed, Drizly shuts down, and wine is losing the battle to spirits for market share. Read on for the transcript of Sam's weekly newscast.
First up – a new ROC vineyard
I’m starting here because I feel like the wine industry could use some celebration.
If you haven’t yet heard of it, ROC (Regenerative Organic Certified) is a globe-spanning environmental certification that began certifying in 2020. Rather than just eliminating pesticide and herbicide use as organics does, ROC requires that agricultural operations also test their soils and show healthy or increasing amounts of organic matter. They encourage no or minimal tilling to sequester carbon and preserve mycorrhizal fungal networks in the soil; integration of animals to help keep weeds down and simultaneously fertilise; and require high standards for human and animal welfare.
For wineries who want to pursue this certification, even if they’re coming from organic certification, this can often involve massive overhauls in farming practices in order to prioritise soil building and can also require restructuring of company communication to give employees more say within the company. Due to the sky-high standards and the all-encompassing nature of the certification, there are fewer than 20 vineyards in the world who have achieved this certification. (*I’ll list them all below so you can look for them in your market.)
The news bit – there are a few very recently certified vineyards. A few months ago, Booker in Paso Robles – owned by Constellation Brands – announced as ROC; two weeks ago Sonoma’s Gundlach Bundschu announced; and last week, Australia announced its first ROC vineyard, Inkwell Wines in McLaren Vale (featured in the image above). While this certification is global, most wine producers are within the US, with one in Chile, two in Argentina, and a few pending in Austria.
As Australia’s first ROC vineyard, and as one located in a country that has been extremely troubled by the global wine downturn, Inkwell has decided to celebrate by launching a winemaking competition with the aim of attracting new wine consumers. They’ll be selecting five up-and-coming winemakers and giving each of them one ton of fruit to work with. The goal is for these newer winemakers to make Shiraz in a style that they think will be most attractive to younger consumers and non-wine consumers. The rules are: no new oak, no fining or filtration, no added yeast, and judicious sulphite use. The wines will be bottled at the end of this year.
On to Drizly’s shutdown
Drizly is a tech company that provides an app where liquor stores list their products, customers order, and the liquor store arranges their own delivery. The platform launched in 2013, boomed in 2020, and was acquired by Uber Eats in 2021. But as of March of this year, the platform will shut down and Uber Eats will roll alcohol delivery into its own offerings.
For anyone who might mourn this … it doesn’t really sound like all that much is changing. Instead, this seems like a strategic move.
The Federal Trade Commission put out a report in October of 2022 that detailed how, in 2018, a Drizly employee put company login information up on a site called GitHub. Hackers grabbed the login and used the company’s servers to mine cryptocurrency. Then, in 2020, there was another breach where a hacker stole customer data. In 2022, the app was hacked again and 2.5 million users had personal data stolen. The FTC responded by limiting the data that Drizly could collect and retain and, rather than allow Drizly to continue on as their own company, Uber Eats is absorbing the platform.
While we’re on the topic, if you strive to support small wineries and local businesses, please do not order your wine through Uber Eats.
A quick reasoning as to why. It’s generally the case that large multinational companies find it easiest to do business with other large multinational companies. You’ll notice that Uber Eats has a lot of chain restaurants, and that Tesco and Costco stock mostly large-volume wine producers. This is because if they stocked small-volume producers, they’d have to keep track of a never-ending list of SKUs from a long list of smaller importers and distributors, they’d frequently run out of stock on certain wines, and it would make for inconsistencies and increased labour requirements. Local shops don’t deal with the same turnover and are more willing to work with small importers or distributors who only get four cases from a mom-and-pop winery.
Honestly, the same rules apply for most industries.
Finally, the Silicon Valley Bank 2024 annual report
The SVB report examines US pricing and sales data and looks at challenges facing the industry. It published on 18 January. The news was not good.
Winery costs have gone up due to inflation. For all but premium wineries, it has been difficult to raise prices commensurate with the increase in costs.
Meanwhile, younger consumers are drinking RTDs, spirits, and cannabis infusions instead of wine. For the first time in nearly half a century, the volume of spirits sold has overtaken the volume of wine.
Despite this, the World Health Organization’s ‘no safe level’ campaign seems to be working as far more people are abstaining from drinking.
Both California and Washington are overplanted when compared with consumer demand. Oregon seems to be in balance but, as a resident, I can tell you that the current vineyards going in aren’t going to do us any favours.
Direct-to-consumer sales and premium wines seem to be the dim light in an industry that’s not doing well.
As far as advice, the SVB is advising flexibility. Personally, I’ve had it with being lumped in with the spirits category. I’d really love to claw market share back. If you happen to find any papers on the relative merits of wine v spirits, please send them my way.
That’s all for this episode of the wine news in five, thanks so much for listening. If you have breaking news in your area, please email me at news@jancisrobinson.com.
*ROC-certified vineyards as of January 2024:
- Ambar Estate – US
- Bodega Chandon SA – Argentina
- Booker Vineyard – US
- Solminer Wine – US
- Domaine Bousquet – Argentina
- The Donum Estate – US
- Bonterra Vineyard – US
- Grgich Hills Estate – US
- Gundlach Bundschu Winery – US
- Medlock Ames – US
- Neal Family Vineyards – US
- Estelbrook Farms and Vineyard – US
- Spottswoode Estate Vineyard & Winery – US
- Tablas Creek Vineyard – US
- Terrazas de los Andes – Argentina
- Inkwell Wines – Australia
- Troon Vineyard – US
- Villa Creek – US
- Vinedos Emiliana SA – Chile
This is a transcript, with links embedded for further reading, of the five-minute news broadcast that Samantha Cole-Johnson, Senior Editor US for JancisRobinson.com, puts out on our Instagram page @jancisrobinson every Tuesday morning. You can also listen to it on The JancisRobinson.com Podcast.
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