The price of wine

There has recently been quite a stir in the wine-web community over the news that the Swedish state alcohol monopoly had launched a tender for Barbera d’Asti wine age in small barrels at a maximum price of 2.30 euros per bottle. When you consider that the average price per bottle for exported Italian wine is three euros and that exported bulk wine sells for 0.68 euros, the offer does not seem to be too bad. However, what is disturbing is that the wine in question has a top DOCG classification, which stands for controlled origin and guaranteed quality, which makes the offer is very degrading.

Undoubtedly, there will producer cooperatives and industrial bottlers who will jump at the offer given that they, as opposed to small producers, have the quantity to sell at a lower per-bottle profit margin. The fact that this is a problem is not easy to understand for those not sufficiently acquainted with the wine business. It is not easy because while the DOC (controlled origin) and DOCG classifications undoubtedly have their merits, they are not enough to distinguish the diverse origins of wines and different production costs. Thus there is a real risk that Gresham’s Law, “bad money drive out good”, may come into play and mediocre wine at a low price will win over better wine, the craft wines and those made with particular care. The reality is that if the consumer has three euros to spend on wine they will buy a wine at that price.

There are some fairly discreet Italian wines that cost relatively little, including the much vilified Tavernello and Ronco which are not flawed and cost around a euro. But these wines are neither DOC nor DOCG classified and in the end you get what you pay for. The basic problem lies with the system of classification itself, the way they are determined and the way the public perceives them. The DOC classification, for example, is important in the collective imagination of those with a superficial knowledge of the wine but it only guarantees origin and not quality, something which the DOCG classification does. By law, in order to receive a DOCG classification a wine must have a “particular merit”. And common sense tells us that this “particular merit” must have to do with high organoleptic qualities which cannot be consistent with low prices. Although there are surly those who cheat this system, as evidenced by the investigations by health inspectors, they are the exception and not the rule and they are not the real problem.

What needs to be clarified is exactly what the classifications are supposed to represent. Whether they are there just for show or as a guarantee of quality for the consumer and for the livelihood of many winemakers. This is the crux of the problem but, unfortunately, Italian politicians and many speculators avoid tackling it and prefer to create a smoke screen and spew terms like “excellence”. This means that consumers are left to fend for themselves either by word of mouth or consulting the few sector publications left in Italy.