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Who’s up, who’s down in Oakville

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Off to Napa Valley later this morning for the annual Taste of Oakville, where dozens of that AVA’s top wineries pour for the trade. Groth, Harlan, Dalla Valle, Atalon, Opus One, Screaming Eagle, Vine Cliff, Rudd, PlumpJack, you name it, they’ll all be there in Mondavi’s Tokalon building, with their proprietors and winemakers (i.e., not tasting room staff) doing the meeting and greeting. I know of no tasting in California that manages to roster up so many stellar luminaries under one roof.

TOO has been going for years now, through good times and bad, and right now is as bad as Napa’s seen in decades. It’s going to be interesting to connect with folks and see how they’re faring. We know anecdotally that the high end has been hurt, and Oakville is as high end as California wine gets, so we have to assume that there’s pain in the little appellation.

It used to be that owners of cult wineries could more or less sit back and rest on their laurels. These wines were so coveted, there were far more people who wanted them than there were bottles available, and so the stuff practically sold itself. There were mailing lists, and waiting lists to get on the mailing lists, and even if you were lucky enough to score a bottle or two, chances are you either (a) were too scared to open anything so expensive, or (b) re-sold it on the aftermarket, at a healthy profit. But the Great Recession has changed everything. Many people who used to be able to afford $400 or $500 for a bottle of wine no longer can. As for the aftermarket, well, check out this article from Yahoo! Finance. Called “How to make a million,” it advised ambitious investors that wine was “ripe for picking.” But look at that pub date: Oct. 10, 2008. That was exactly three weeks after Lehman Brothers collapsed. Now, the article’s title looks like a bad joke. Today, it would be called “How to lose a million.”

So even millionaire owners of cult wineries have to get out there and sell. Even the 2009 Bordeaux are likely to face an uphill battle if they get too costly, with merchants and restaurateurs expressing doubt that the top wines will be scooped up despite the hyped vintage, according to this article in today’s Wine Business Online, reprinted from Decanter. If Leoville Las Cases and Angelus are hard to move, it’s difficult to see Kelham and Futo sailing out the door. Although the retail value of California wine sold in 2009 was down only three percent, according to the Wine Institute, that number is misleading, because it’s skewed toward high-volume producers. The higher the retail price on a bottle, the further the price fell. I did a little Internet search comparing the suggested retail prices on Napa Cabs sent to me versus what they’re selling for online. Here’s a partial list:

Trefethen 2005 Reserve Cabernet Sauvignon: SRP $100. $70 online
Continuum 2007, $140 vs. $100
Hestan 2006, $100 vs. $46
Flora Springs 2007 Hillside Reserve, $100 vs. $85
Parallel 2006, $125 vs. $53
David Arthur 2007, $95 vs. $79

On the other hand, a few wines are actually exceeding their SRP. Pride Mountain’s 2006 Reserve Claret was released at $125; I couldn’t fine it anywhere for less than $145, and in some places it topped $200. Ditto for Colgin’s 2006 IX Estate Red Blend. Released at $290 SRP, it’s now available online for $400 and up. What this tells me is that consumers are being very fussy about their “cults.” Pride Mountain and Bob Foley may be bulletproof. Colgin, too, given its history and pedigree. But many others aren’t. For one reason or another, the brand loses luster. Consumers, when they’re spending lots of money on discretionary things, need to be excited. Rightly or wrongly, many expensive Napa wines no longer thrill. I think I’m going to see some of them today at Taste of Oakville.

  1. VERY interested in the results!

    I spent the better part of this past weekend tasting / celebrating with friends, and the majority of that group openly despised the New World, CA Cab style. It was interesting, but I felt that CA got too short a shrift among those folks…

  2. Yeah, well dude, you are developing a California palate! Welcome to the club…

  3. Ha! You’re totally right about that palate. It was odd being the lone dissenter, but fortunately I can still hang with the Francophiles with *just enough* knowledge and appreciation of the “lighter touch” winemaking :-).

  4. The so-called “New World” Style is a bit of nonsense. CA and Aussie wines were not only perfectly good for those Eastern-based snobs, but the suggestion that the wines have changed dramatically is simply not borne out by the facts. Somehow 14%, even 15% Bordeaux is acceptable, but Napa Valley Cabs, so many of which are under 14.5% are not.

    Let’s call it like it is. These folks are like lemmings. Very little has changed, but the palpable distaste for New World wines these folks now express is based on an illusion, not in reality.

    Now, I am not saying that there are no overripe, overextended Napa Cabs, but there are dozens and dozens of balanced wines, some of which are included in Steve’s survey above.

  5. 2006 Harlan – masculine, layered wine, some wood tannins
    2007 Screaming Eagle – totally different wine than Harlans – balanced is a good word to describe this wine

    Loved the new 2007 Collina from Dalle Valle – drinking real nicely upon release

    2007 Materium from Maybach Cellars is also nice by itself – it is a very rich luscious wine

    Always interesting to taste the complete differences in wine profiles esp from east vs west oakville

  6. Dave, I made a video in which we interviewed several winemakers on the east-west thing. It should be up within a week on Wine Enthusiast’s website, http://www.winemag.com.

  7. Cool – thanks Steve. I look forward to watching that when its live.

    Regards,

    Dave

  8. Steve,

    No doubt some of our Oakville friends are not too happy with the depletions these days. That’s said it is nothing compared to the inventory we are seeing back up on some of the wines in the 40-60 range from wineries bottled under broader or less pedigreed AVA’s. The ageing’s are backing up and the warehouse is full of wine. The market is not returning anywhere near as fast as they had hoped. Many brands will have a rough time but be fine as long as they dig in and control costs however many others are still overleveraged and are on the way out.

    It will be interesting to see how it trickles into other market segments this year. Very preliminary harvest reports call for a big crop. Tank space is pretty full and the bulk market is hot and cold. It’s going to be interesting for a while now.

  9. Hey pops (aka Charlie) – I think to some degree you’re right. A few people at the party that night tasted a 2002 Geyser Peak (from 3L) and immediately dismissed it using words like “terrible” and “awful”. Meanwhile, they gulped down a 2005 Chablis that clearly had some faults with overtones of sauerkraut.

    I’m not saying they are lemmings, and clearly it’s fine to have preferences, but dismissal without even a cursory analysis is best left for only one wine: Retsina. ;-)

  10. My personnal favorites were the 2007 Hoopes and Liparita Oakville Cabs. From an “Oakville” price point perspective, they delivered the best quality at the best price, $65.00 and $55.00 respectively.

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