Tim James: Are producers getting ahead of themselves when it comes to top-end wine prices?

October 31, 2017
by Tim James
in Opinion & Analysis
with 9 Comments

It’s so often that we’re told how underpriced South African wine is, that it makes an interesting change to see a different viewpoint expressed – at least in regard to the top end. It’s one that, I’m pretty sure, will resonate with a lot of serious but not rich wine-lovers here, who see that R150 is the new R80, and that the number of wines soaring well over the R200, R300 and R400 marks seems to increase every day, including from new wines and new winemakers with little or no track record.

How many of them, in fact, are going to survive? Certainly not all, I’d say. Followers of the New Wave might recall, for example, the brief comet appearance of Tim Martin Wines, a range of pretty decent, but not outstanding stuff – natural, Swartlandish, trendy varieties, all the usual stuff, at prices around R200. Hard to sell, and the winemaker was wise enough to pull the plug pretty quickly (he sold his Salt River premises to Duncan Savage, with a brand that had been so much more solidly established over the years).

new-wave-logoAnyway the point of price was hinted at by Jancis Robinson in her very enthusiastic reviews of some important recent showings of South African wine in London: the recent large New Wave tasting, and an Old Vine Wine tasting in June. The longer sets of tasting notes are behind the paywall on her website, but there’s also a freely accessible longer version of her latest Financial Times article on the subject – though if Michael Fridjhon’s recent musings on the subject of a largely untransformed wine industry made you fume, perhaps better not look at Jancis’s piece, accompanied by an aerial shot of Crossroads, and beginning: “The South African wine industry is at a very strange, possibly critical, point in its evolution.”

The article doesn’t really elaborate on that, or explain where the crossroads differently lead, but it’s interesting. And very gratifying for the winemakers at the at the London New Wave tasting (a remarkable number rated at least 17 points out of 20). The second sentence of her FT article goes thus: “This month’s tasting in London of New Wave South African wines may well have been the most exciting I have ever attended in a capital spoilt for professional wine tastings.” Wow. That’s quite a statement.

As to the price issue, she commented in her report on the New Wave tasting that: “The tasting catalogue included recommended retail prices for all the wines and it seemed to me there had been a dramatic increase since the last tasting in 2015 – more than the recent slide in sterling would account for.” {She doesn’t realise the even greater slide in the rand!) Beyond the general comment, which is not necessarily a critical one, there were a few slightly barbed observations. She liked the Mullineux Granite Chenin Blanc but noted: “Not cheap though….” (British RRP £48.99). Of Mvemve Raats de Compostella 2014, slightly less pricey: “Too expensive”. Of Reyneke Chenin Blanc (£60): “I think the premium asked is a bit steep for me though.”

As to Leeu Passant, certainly amongst the most expensive ranges of South African wine, there was more said about the pricing than the wines:

Leeu Passant Chardonnay 2015 (£65): “Not given away! Muted nose. Stony and sappy – very appetising. Certainly well made and well judged. This is superior Chardonnay and is arguably more welcoming than many a white burgundy at this price. But I would have thought it will be a much easier sell in South Africa than abroad.” (To which I’d say – at R625, I’d guess not an easy sell here either!)

Leeu Passant Dry Red 2015 (£98.50 – don’t you love that “.50”?): “Quite a price!!! Very nicely done with no rough edges and masses of pleasure but I do wonder whether it is running before it can walk in terms of price. I’d love someone to pour this for me but cannot imagine buying it myself.”

Jancis understands the industry situation here very well, of the need to pay decent grape prices. I’m also sure she’s very well aware, though, that high grape prices don’t always easily translate into some of the prices being asked for Cape wine these days. Which is true of top-end wine around the world, of course, but let’s not forget that it’s increasingly the case here.

  • Tim James is founder of Grape.co.za and contributes to various local and international wine publications. He is a taster (and associate editor) for Platter’s. His book Wines of South Africa – Tradition and Revolution appeared in 2013.

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9 Comments

  1. Dave IngramNovember 1, 2017 at 7:47 amReply

    The right price for anything is the most people are prepared to pay. As captured SA has more cash available so prices will go up. If you are not happy with the prices then don’t buy.. Tasted some pretty ordinary wine @ R500 a bottle at WineX as well as some reasonable wine @R100 .
    Interestingly the Champagne at Reciprocal was totally natural nothing added.. yet very pricey. It’s not always the casks that make it expensive, it can also be greed. Il enjoy my R80 wines thank you…

  2. Melvyn MinnaarNovember 1, 2017 at 6:06 amReply

    It’s this increasingly sad thing of our times that to some worth is only seen and calculated in monetary terms.

  3. JacquesOctober 31, 2017 at 2:58 pmReply

    Totally agree with the sentiments of this article, or at least the suggestion it is putting forward. Premium wines in South Africa have gone up noticeably in price in many cases which means the average middle-class wine lover will only ever get to enjoy them at a tasting venue, if they’re lucky. Dangerous ground to rely on international sales only.

  4. Kevin ROctober 31, 2017 at 2:36 pmReply

    As a consumer, I think we should happily accept higher prices from estates who are genuinely putting the wine first (in terms of being more innovative and pushing quality boundaries) as these prices will allow them to do more.

    Where producers are “milking it” however (high prices and no planned improvements), well buyers are simply settling for less in the long run.

    This debate will never end.

  5. Ashley WestawayOctober 31, 2017 at 11:01 amReply

    This is precisely what I respect so much about Eben Sadie. Year in and year out, the increases are modest, despite the fact that his wines are in such high demand. And then you get producers who hardly have a track record who price themselves above Sadie. Good luck to them.

  6. KwispedoorOctober 31, 2017 at 10:57 amReply

    Cudos to the guys out there who don’t go completely overboard. Surely a guy like Eben Sadie can sell his Ouwingerdreeks wines at a much higher price and still sell out a whole vintage long before the next one is ready. And I’m guessing he doesn’t stiff any farmers or vineyard workers. There are many others as well, even at much lower prices. I think perhaps it’s important to some winemakers that their wines are also enjoyed by really passionate wine lovers, not just rich people or journalists. It’s clear though, that not all of them have a similar vision in this regard. Greed and conceit is increasingly creeping into many strategies…

    Who is actually buying Bordeaux First Growths nowadays – your average wine geek or Chinese upper class dudes trying to show off? And even if some geek manages to fork out a month or two or three’s rent for a First Growth, he/she is only ever going to buy one bottle. Fat chance of getting to know the wine more intimately as you journey through a case over the years.

    • JamesNovember 1, 2017 at 3:52 pmReply

      100% Kwispedoor!

      But surely whatever the producers do is fair play. All will reap what they sow. Some of them (Sadie as you mentioned, Savage another, Thelema too IMO) have a track record and are making special wines accessible to ordinary folks when they could get away with substantially raising their prices. Good for them, and in the long run they pick up grateful buyers for life. Others are making great wines and ARE getting away with higher prices. Good for them too. If someone’s willing to pay for them, they’ve clearly earned the right. Free market and all that.

      Then there are those who – let’s face it – are taking a chance. Reputation or not, they’re having a laugh. I guess some folk with more money than sense will dabble, but that’s their problem. Happily we all get to vote with our wallets.

      Of course, as always it’s more nuanced than this, but like anywhere, we have our share of producers looking to make some money (and spread the love to their perennially under-rewarded suppliers). This is to be encouraged.

      One thing’s for sure, there are still a lot of R80 bottles on our shelves that deserve to be closer to R200!

      • KwispedoorNovember 1, 2017 at 5:13 pm

        I agree with your whole comment, James. Yes, it’s a free market and nobody forces consumers to buy any particular wine. And there are still plenty of silly bargains to be had.

        Tiny volumes of supply also influences some of the higher priced wines in SA. If someone makes really great wine from a really great old (and demanding) one hectare low-yielding vineyard and there’s very little of it, then it only makes sense to ask a high price. Sustainability also demands it.

        On many levels, it’s actually great to see when certain high prices are sustained. It’s just that, above a certain price point, producers need to realise that they will start losing certain types of consumers and the higher the price goes, the more homogeneous the customer demographics will become. Some producers actually want their brands to be elitist, so they won’t see any problem there.

        As a consumer that would like to have plenty of all the best wines in my cellar, I have to make peace with the fact that some of them are simply out of my reach – and increasingly so. At least It makes me more appreciative when I do get to encounter them somewhere.

        There’s a much bigger problem at the lower end though, where the bulk of wine drinkers out there still balks at spending more than R50 or R80 on a bottle.

  7. MikeOctober 31, 2017 at 8:56 amReply

    And yet the SA consumer is constantly admonished by certain wine makers for not paying these ridiculous prices. One or two decent vintages and a few ever-creeping ratings (the high tide lifting all boats ?) and prices for relatively new and untested wines head north of R300/R400 …. good luck to them but won’t be gracing my cellar.

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