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09.10.2004

Parker Predicts The Future of Wine and I Respond

What should appear before mine eyes as I leaf through my latest issue of Food and Wine Magazine? Yea, verily, a prognostication from the most contentious of oracles, Robert M. Parker, Jr.

Like it or not, this guy is the world authority, and so when he makes predictions, even I sit up and take notice. My comments are included below each prediction in italics.


Parker Predicts the Future
Robert M. Parker, Jr., the world's foremost wine guru, makes 12 bold predictions about seismic changes that will influence how we'll shop, what we'll buy and how much we'll pay.

By Robert M. Parker, Jr.

Predictions are often carelessly thrown together lists, since few people remember them 10 years later. Who is going to call the author after a decade and complain about his boneheaded observations? Still, I confess to having given the following 12 predictions considerable thought. Moreover, I am confident that they will come true sooner rather than later.

1. Distribution will be revolutionized
I predict the total collapse of the convoluted three-tiered system of wine distribution in the United States. The current process, a legacy of Prohibition, mandates that all foreign wines must be brought into the country by an importer, who sells them to a wholesaler, who sells them again to a retailer. Most U.S. wineries sell to a distributor, who in turn sells the wines to a retailer. It is an absurdly inefficient system that costs the consumer big bucks. This narrowly restricted approach (blame all the lobbyists funded by powerful liquor and wine wholesalers) is coming to a dramatic end—hastened in part by the comparative ease of ordering wine over the Internet. Differing federal court opinions over the last decade have insured that eventually the Supreme Court will have to rule on whether wineries can sell directly to whomever they wish, whether it is a wholesaler, retailer or consumer. Imagine, if you can, a great Bordeaux château, a tiny estate in Piedmont or a small, artisanal winery in California selling 100 percent of its production directly to restaurants, retailers and consumers. I believe it will be possible by 2015.

AMEN TO THAT. While Parker and I often disagree about wine, I think he's hit the nail on the head with this one. While its easier to see this system crumbling in liberal California than it is in states that currently have draconian state-run distribution laws, I agree we are witnessing the Decline of the Distribution Empire.

2. The wine Web will go mainstream
Internet message boards, Web sites tailored for wine geeks and state-of-the-art winery sites all instantaneously disseminate information about new wines and new producers. Today the realm of cyberspace junkies and hardcore Internet users, these sites will become mainstream in 10 years. A much more democratic, open range of experts, consultants, specialists, advisors and chatty wine nerds will assume the role of today's wine publications.

Hmmm. I can't quite put my finger on this one....sounds really familiar though....

3. World bidding wars will begin for top wines
Competition for the world's greatest wines will increase exponentially: The most limited production wines will become even more expensive and more difficult to obtain. The burgeoning interest in fine wine in Asia, South America, Central and Eastern Europe and Russia will make things even worse. There will be bidding wars at auctions for the few cases of highly praised, limited production wines. No matter how high prices appear today for wines from the most hallowed vineyards, they represent only a fraction of what these wines will fetch in a decade. Americans may scream bloody murder when looking at the future prices for the 2003 first growth Bordeaux (an average of $4,000 a case), but if my instincts are correct, 10 years from now a great vintage of these first growths will cost over $10,000 a case...at the minimum. It is simple: The quantity of these great wines is finite, and the demand for them will become at least 10 times greater.

This may, in fact, be the case, but a corollary to this is that overall wine quality around the world will rise along with these prices, meaning that those of us who CAN live without that Chateau Lafite will find better and better wines at our price points.

4. France will feel a squeeze
The globalization of wine will mean many things, most of it bad news for the country historically known for producing the world's greatest wines: France. The French caste system will become even more stratified; the top five percent of the estates will turn out the most compelling wines and receive increasingly astronomical prices for them. However, France's obsession with tradition and maintaining the status quo will result in the bankruptcy and collapse of many producers who refuse to recognize the competitive nature of the global wine market.

I'm not so sure this is 100% true. I think that many winemakers in France (those often beneath the notice of Parker) will step up to the new realities of the market and of international taste. For those stodgy old buggers that would rather suffer the dire fate that Parker describes rather than change their ways, well, serves them right.

5. Corks will come out
I believe wines bottled with corks will be in the minority by 2015. The cork industry has not invested in techniques that will prevent "corked" wines afflicted with the musty, moldy, wet-basement smell that ruins up to 15 percent of all wine bottles. The consequences of this laissez-faire attitude will be dramatic. More and more state-of-the-art wineries are moving to screw caps for wines that need to be consumed within 3 to 4 years of the vintage (about 95 percent of the world's wines). Look for this trend to accelerate. Stelvin, the screw cap of choice, will become the standard for the majority of the world's wines. The one exception will be great wines meant to age for 20 to 30 years that will still be primarily cork finished—although even the makers of these wines may experience consumer backlash if the cork industry does not solve the problem of defective corks. Synthetic corks, by the way, are not the solution. They do not work and can't compete with the Stelvin screw caps.

I don't know exactly what he's talking about when he says synthetic corks don't work (that's news to me) but I wholeheartedly agree with the screwcap prediction. Let's get on with it already. They are the future.

6. Spain will be the star
Look for Spain to continue to soar. Today it is emerging as a leader in wine quality and creativity, combining the finest characteristics of tradition with a modern and progressive winemaking philosophy. Spain, just coming out of a long period of cooperative winemaking that valued quantity over quality, has begun to recognize that it possesses many old-vine vineyards with almost unlimited potential. Spanish wineries recognize that they are trapped neither by history nor by the need to maintain the status quo that currently frustrates and inhibits so many French producers. By 2015, those areas that have traditionally produced Spain's finest wines (Ribera del Duero and Rioja) will have assumed second place behind such up-and-coming regions as Toro, Jumilla and Priorat.

I've just started exploring these wines, so I can't comment on whether I believe that this is true, but Spain certainly seems to have promise.

7. Malbec will make it big
By the year 2015, the greatness of Argentinean wines made from the Malbec grape will be understood as a given. This French varietal, which failed so miserably on its home soil in Bordeaux, has reached startling heights of quality in Argentina. Both inexpensive, delicious Malbecs and majestic, profoundly complex ones from high-elevation vineyards are already being produced, and by 2015 this long-ignored grape's place in the pantheon of noble wines will be guaranteed.

Huh? OK, Robert, maybe you should tell me which ones to try, because every Malbec I've ever had (maybe 20 or 30 in my life) I really haven't liked.

8. California's Central Coast will rule America
Look for wines from California's Central Coast (an enormous region that runs from Contra Costa down to Santa Barbara) to take their place alongside the hallowed bottlings of Napa and Sonoma valleys. No viticultural region in America has demonstrated as much progress in quality and potential for greatness as the Central Coast, with its Rhône varietals, and the Santa Barbara region, where the Burgundian varietals Chardonnay and Pinot Noir are planted in its cooler climates.

Paso Robles, Santa Rita Hills, Santa Cruz Mountains... they're all fantastic wine producing regions and definitely will come into their own. I go one further and predict that in the next 20 years we will see a breakup of this massive region into more distinct AVA regions.

9. Southern Italy will ascend
While few consumers will be able to afford Piedmont's profound Barolos and Barbarescos (which will be subject to fanatical worldwide demand 10 times what we see today), once-backwater Italian viticultural areas such as Umbria, Campania, Basilicata and the islands of Sicily and Sardinia will become household names by 2015. The winemaking revolution currently under way in Italy will continue, and its rewards will become increasingly apparent over the next decade.

I have really enjoyed the bit of exploring I have done recently in the wines of the Apulia region, and particularly those of Salento, which is in the heel of the boot. They certainly rival the best Chiantis in my mind and some of the other varietals used in these regions like Malvasia Nera are incredibly dynamic and expressive grapes.

10. Unoaked wine will find a wider audience
Given the increasingly diverse style of foods we eat as well as the abundant array of tastes on our plates, there will be more and more wines that offer strikingly pure bouquets and flavors unmarked by wood aging. Crisp, lively whites and fruity, savory and sensual reds will be in greater demand in 2015 than they are in 2004. Wood will still have importance for the greatest varietals as well as for wines that benefit from aging, but those wines will make up only a tiny part of the market.

'Bout damn time. We are still currently on oak overkill around here. I think this will be a slow change as the A.B.C Movement (Anything But Chardonnay, which is largely in reaction to the heavily oaked over-malolactic tasting California Chardonnays) is still in the minority.

11. Value will be valued
Despite my doom-and-gloom prediction about the prohibitive cost of the world's greatest wines, there will be more high-quality, low-priced wines than ever before. This trend will be led primarily by European countries, although Australia will still play a huge role. Australia has perfected industrial farming: No other country appears capable of producing an $8 wine as well as it does. However, too many of those wines are simple, fruity and somewhat soulless. Australia will need to improve its game and create accessible wines with more character and interest to compete in the world market 10 years from now.

I agree about the values, as I mentioned above, but it's interesting that Parker used this as an opportunity to get a dig in on Australia. While he may not like many of those wines, perhaps he has noticed that the majority of Americans DO.

12. Diversity will be the word
By 2015 the world of wine will have grown even more diverse. We will see quality wines from unexpected places like Bulgaria, Romania, Russia, Mexico, China, Japan, Lebanon, Turkey and perhaps even India. But I believe that even with all these new producers, the saturation point will not be reached, since ever greater numbers of the world's population will demand wine as their alcoholic drink of choice.

Parker forgot Greece in there as well. It will be very interesting to see how regions that currently have a very poor agricultural base see the opportunity for profit in winegrowing.

Comments (22)

Ryan wrote:
09.10.04 at 7:48 AM

I'm going to disagree with you Alder and agree with Parker on the Malbec mention. Many people I talk to and drink with prefer Malbec as their table wine of choice. Its incredibly inexpensive and its wide range of complexities offers drinkers enormous choice to find which suits their palette best. I fall under this umbrella. I have really been enjoying Malbec from Argentina especially for their value. While many producers still have some work to do in perfecting this grape, I think Malbec, in the years to come, will make quite a mark among wine lovers everywhere.

Alder wrote:
09.10.04 at 7:51 AM

Excellent. Perhaps you can recommend one or two. I haven't completely written it off, just been very disappointed with what I've had so far.

09.10.04 at 8:18 AM

Re synthetic corks. Hogue recently did a three-year study of different closures. The problem with synthetics was that the wine tended to be more oxidized. Not sure of the reason: do synthetics shrink? Or not expand enough with moisture?

Re central coast. There are already movements afoot to break up Paso Robles, though they're as yet quiet.

Re France. You can't simultaneously argue for approaching a more international style and for embracing diversity. If everyone's aiming towards a similar style, it kills diversity. I for one really like classic French wines and dislike Napa wines. I'd rather have both options though then to have all moving towards an international style. I think France will suffer just because there are more places making good wine.

Erik Talvola wrote:
09.10.04 at 10:37 AM

On the Central Coast AVAs - I agree that Paso Robles and a couple others are enormous - but there are already 28 AVAs that are sub-AVAs of the enormous Central Coast AVA, including many (Wild Horse Valley, Lime Kiln Valley, San Ysidro District, Pacheco Pass, etc.) that are smaller than many of the famous Napa Valley appellations.

Alder wrote:
09.10.04 at 10:44 AM

Yeah, what I'm thinking is that while many of those sub apellations will probably remain intact as entities, they ought to divide the Central Coast into two, maybe three sections, one that includes Santa Cruz to Monterey, one that includes SLO, and one that is Santa Barbara and environs

Rob wrote:
09.10.04 at 10:51 AM

I've had some so-so Argentinian Malbecs, so I tend to agree with Alder. Still, I was surprised this week by a French blend (2000 Domaine Paydeval) of 80% Malbec with Merlot and Syrah remaining. Very good for the money -- medium -bodied, muted fruit, full (French-style) tannins. I picked it up at Whole Foods for under $15. I has a peculiar oval label.

enoch choi wrote:
09.10.04 at 11:24 AM

re: derrick's mention of the Hogue study. I remember reading that synthetic corks suffered oxidation at 2 years, whereas the screwcaps drank well at 5 years.

elsewhere, i've read there's risk of TCA taint as well, albeit less than natural cork. And it's from the synthetic closure itself, not from the rest of the vinting process (e.g. BV's recent problems, covered by the spectator)

paul a'barge wrote:
09.10.04 at 12:38 PM

What about Texas wines .... he left off Texas wines.

What's up with that?

HugeJ wrote:
09.10.04 at 1:26 PM

I disagree with the distribution point, actually. While I agree that direct access for high-end wines will come with time (hopefully with the next Supreme Court session), for the vast majority of wines (those that Parker doesn't deal with), the three tier system actually works pretty well. Sutter Home doesn't want to directly manage the sales of 8,000,000 cases into 450,000 retail locations across the country. Its not what they do. That service is provided by distributors in each state who understand the local laws and regulations. For the majority of the market, its actually a good system. Its when the distributors claim that they're protecting America's teens by preventing direct access through the web that they lose all their credibility...

/huge

Alder wrote:
09.10.04 at 6:19 PM

I'm not sure I completely follow your logic Huge. I'm sure that while Sutter Home doesn't want to manage sales to individual retailers, they, like most manufacturers would benefit immensely from disintermediation (getting rid of the middleman). To larger companies like this, the impact on their margins would be enormous and they would be raking in the dough. The trick is to do it in a way that automates it (via some sort of extranet or automated ordering system that allows these retailers to place orders, etc.) Large manufacturers all over the globe have been doing this for the last two decades with great success.

However, I don't mean to completely dismiss your point -- there are doubtless many large producers who will not be interested in rejiggering their value chain and they are probably numerous enough to prop up the existing distribution infrastructure.

HugeJ wrote:
09.12.04 at 8:43 PM

Seems like theres a non-sequitur there. How do you get rid of the middleman without having to manage sales to individual retailers? That's the very function that wholesalers provide...

"Large manufacturers all over the globe have been doing this for the last two decades with great success."

True, but they don't have to deal with 50 states that all have their own unique liquor laws. Even most of the large booze distributors aren't in more than a half-dozen or so states each (there are multiple reasons for that, however).

AB can do it (deal direct) with their beer but that's because they have such a huge share of the market. I believe (and maybe I'm wrong here) that they are the only major brewer that does so on a nationwide scale. If SAB-Miller can't sell direct, how can even Sutter Home do so? Miller probably sells 100 units for every unit SH sells. Agree the profits seem to be there for the taking, but at this point, only Gallo has taken any steps to eliminate this step in the supply chain....if it were so easy to do, everyone would have done it already....


/huge

wam wrote:
09.14.04 at 4:20 AM

it's all very interesting. guess what, no one heard of this in France. i'll begin ;)

Alder wrote:
09.15.04 at 2:28 PM

As an FYI, Huge has posted a follow up to his comments on distribution with some more detail and information on his own blog. Check it out here.

Darby wrote:
09.15.04 at 4:48 PM

The comments about Australia being able to produce wines at $8 a bottle are a bit out of date. The price is dropping on most varietal wines except Shiraz. You will get some massive bargains in Aussie Cab Sav and Cab dominated blends in the future. The other interesting trend in Australia is the massive increase in interest in alternative vartietals. Not much of this wine is exported at present, but you will find more and more over the next few years. White drinkers should look out for Verdelho, Chenin blanc, Marsanne, Pinot Grigio/Gris and Viognier from Australia. Red lovers will find some interesting Sangiovese, Tempranillo and Chambourcin. Zinfandel is being increasingly planted and a revivial of the old favourite Grenache is well under way.

Alder wrote:
09.15.04 at 4:57 PM

I've recently started to get some exposure to these "alternative varietals." One of my favorites is this Verdelho.

Christian wrote:
09.18.04 at 12:47 PM

For what it's worth, here's my .02. I too recieved the Food & Wine and was interested to see that Mr. P. was giving a heads-up on things to come. However, after reading the article, there seem to be very few "pre"-dictions at all. And I take acception to a few of his thoughts:

"1. Distribution will be revolutionized."
I am not convinced of this at all. Here in Georgia many of the laws date back to prohibition or earlier. Almost nothing has changed since then and I expect very little will.

"2. The wine Web will go mainstream"
This is like Dan Rather wanting to 'break' the story if the documents aren't real.

"3. World bidding wars will begin for top wines"
I agree with Alder on this one. I would think it to be obvious that overall quality is increasing and as such, the top producers will take advantage of the 'price = quality' mentality of most consumers.
This quote however takes it. "There will be bidding wars at auctions for the few cases of highly praised, limited production wines.' I find it amazing that he somehow removes himself from the equation. Don't know how many of you reading this are in retail, but a Parker rating is usually the deathknell to supply of that wine.

"4. France will feel a squeeze"
Again, not a prediction, a current fact. Backlash from their opposition to 'the war' did little to boost sales of French wine (or the American Potato) and is a sentiment that I hear to this day. The 'international' taste thing can be a slippery slope. If my son had his way, there would be nothing but Cheeseburgers 24/7. I'm sure he's not alone.

"5. Corks will come out"
Fact, not a prediction. I'm not sure who reads Food & Wine but you would have to hiding under a pretty big rock not to have noticed this by now. And the "15% of all wine bottles" is ridiculous. I am so tired of these silly numbers being thrown around.

"6. Spain will be the star"
Spain already is the star. Maybe I am hyper-sensitive to a few of these things given the nature of my shop, but Spain almost without exception is blowing the rest of the world out of the water as far as quality to price is concerned.

"7. Malbec will make it big"
Yet again, this has already happened. What I hope for Argentina is that they will get away from the more fruit forward, kool-aid Malbecs and make wines that are a bit more true to form. Weinert has been doing this for some time and others will follow suit. Also, the grape did not 'fail so miserably' in as much as it was not suited for the weather in Bordeaux. Anyone interested in proper French Malbec would be well served to look into the wines of Cahors. This is its true home soil and it is documented as being grown there since the 7th century.

"8. California's Central Coast will rule America"
For anyone that can get pronounce something more that four letters (NAPA), this is a foregone conclusion.

"9. Southern Italy will ascend"
After a while, some of this starts to sound like filler. This too is already happening and has been for some time.

"10. Unoaked wine will find a wider audience"
Alder is on the right track here. It's a litte secret that much of Europe already knows, especially with white wines. Complete destruction of fruit via uber-toasted, 100% new oak does little for most people. You might as well stick a 2x4 in a glass of Welch's and save some money.

"11. Value will be valued"
I predict that somewhere the sun will come up tomorrow and that it will rain somewhere else.

"12. Diversity will be the word"
The reality is that at least a few of these regions are already producing 'quality' wines. Unfortunately, Bulgaria is not yet a household name in America. I'd be willing to bet that the people of Bulgaria know their wines and the goods ones from the bad. This could all change very easily with proper direction and investment. I for one can't wait.

Yvette wrote:
10.07.04 at 5:02 PM

10. Unoaked wine will find a wider audience

You don't know how happy this makes me. I'm a proud member of the ABC movement and am looking forward to nice California un-oaked Chard.

Craig Young wrote:
12.21.04 at 9:16 AM

I agree with his commnets on several points. Most of already taking place.
I can't seem to understand his dislike of Aussie wines? They are so popular and offer a easy drinking style that North Americans seem to like. Perhaps over time the average palate here will catch up with Parker.....

An earlier post was looking for some examples of Argentine Malbec

One that I would highly recommend is the Trivento Golden Malbec Reserve.
It is a wonderful malbec. Almost ink in color with Red fruit aromas - raspberry, cherry and plum with hints of coffee, mint, tobacco and chocolate on the finish.

Sean wrote:
01.03.05 at 1:29 PM

As a person who deals with distribution issues everyday (not in wine yet though), I wonder how you expect the wineries to be able to be setup to ship to consumers a few cases or a few bottles at a time, not to even mention the relatively smaller quantities to the retailers? If the wineries are used to dealing with larger shipments to the distributors, what will make them add more employees and administrative work to handle the extra work?

Alder wrote:
01.03.05 at 1:30 PM

Sean,

Nearly every winery I have ever visited was more than happy to sell me wine in their tasting room and ship it to me if I didn't feel like carrying it out with me. This means they already have (perhaps in a limited fashion) the ability and the process in place to sell wines to consumers no matter what their relationship with distributors.

Every winemaker and winery I know would LOVE to sell direct to consumers because it means significantly higher margins for them. This is really the thing that will motivate wineries to add staff and infrastructure to be able to handle the needs of direct shipping. And let us be clear, we're talking significantly higher margins. A $45 dollar bottle of wine costs a winemaker maybe $12 to make, and they can only sell it to a distributor for $18, who then sells it to a retailer for $30 who then sells it to me for $45. In that value chain, the winery makes $6 per bottle. Compare that with selling it to me directly at $45.

However, some wineries, faced with the definitely higher costs of the shipping and commerce operations may opt to continue to rely on the distribution network, which will always have a place in this world. And channel conflict is a real issue that will have to be worked through, but plenty of other industries have dealt with it.

I'm betting though, that most wineries would love to sell direct, especially those smaller wineries who cannot get a distributor to give them the time of day and as a result, often end up going out of business even though they have great wine and people who want to buy it.

Rossen Philipov MD wrote:
10.13.07 at 10:54 AM

'unexpected places like Bulgaria' ?
You don't know the ancient history of grapes cultivation and winemakiing.
Viticulture exist in south-eastern Europe since Greek and Roman times well-documented in Tracia which is a Bulgarian province.

Alder wrote:
10.13.07 at 10:59 AM

Rossen,

You are misunderstanding this article in two ways.

1. I am not the author of the phrase "unexpected places like bulgaria" Robert M. Parker, Jr. is. My comments are in italics underneath his.

2. Parker is not saying that it would be unexpected for wine to come from Bulgaria. He is saying that in general the international wine world is not expecting high quality wines to emerge from Bulgaria, but that it actually might to happen.

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Required Reading for Wine Lovers

The Oxford Companion to Wine by Jancis Robinson The Taste of Wine by Emile Peynaud Adventures on the Wine Route by Kermit Lynch Love By the Glass by Dorothy Gaiter & John Brecher Noble Rot by William Echikson The Science of Wine by Jamie Goode The Judgement of Paris by George Taber The Wine Bible by Karen MacNeil The Botanist and the Vintner by Christy Campbell The Emperor of Wine by Elin McCoy The World Atlas of Wine by Hugh Johnson The World's Greatest Wine Estates by Robert M. Parker, Jr.