What is the most egregious wine pricing you have seen?

[phillisc]

Hope this isn’t as boring as the above .

I was chatting to a wine friend in Piedmont about expensive Barolo and Barbaresco - which really isn’t in the league of Australia incidentally.

He was in awe of the marketing prowess of a producer who releases one of the most expensive wines in the region. He claims his secret is creating a feeding-frenzy by releasing a small number of bottles and keeping the rest dribbling onto the market . Says he gets inundated with demand . It’s great wine but the pricing silly .

No its not, but take your point.
What you outline above has been happening in Australia for decades and TWE with their main brand and only label drip feed to market every vintage or through external forces (and excuses) suggest its all gone North.
Then when they finish with their games and cast a dubious eye over warehouses full of stock, it suddenly floods the market with a price that may reflect what the chains were doing in the first place. Again agree, stupid marketing strategy and indeed very silly prices.

Agree lets get back to egregious pricing...Henschke got anything in the wings Jamie
Cheers Craig

[Polymer]

A very thorough parsing Polymer, however, I think you'd agree that even though your scenario is theoretically possible it is counterintuitive.

Don't you think Olivers are not likely to allow Penfolds to take their best grapes if and when they choose, allowing their HJ and their very occasional reserve wine (only 2010 and 2014) to be made from the leftovers. For example, suppose that in a good vintage there is an amount of excellent grapes that would qualify for their M53 wines. Do you think Olivers would agree to give up on making the wine because Penfolds decided to take them. It doesn't strike me as something that Oliver would agree to.

Mahmoud.

It could be counterintuitive if you only look at it from a single standpoint or possibility...

There is some sort of agreement in place that must be mutually beneficial because if it was just one sided, then there is no reason for them to enter into the contract. Maybe that contract states they'll buy X amount of Y graded grapes at Z price each year...as long as Penfolds gets first right of refusal on all A+ graded grapes and that bulk growing is what keeps them afloat....Maybe the actual amount for grapes used for Grange is a huge amount per ton...Given the wine sells for 600 a bottle, that gives Penfolds a whole lot of room...

But we know TWE doesn't own all of the vineyards it has access to for Grange..and we know non TWE wine is made from vineyards that sometimes go into Grange...is the thought that Penfolds takes certain rows/sections every year no matter what? If these are your best sections/rows, throwing this back at everyone else, what would be your incentive to just do that?

[George Krashos]

Penfolds grades fruit every year and decides what fruit makes Grange. It offers X dollars per ton for Grange quality fruit. It's as simple as that. If you decide to sell to Penfolds, then all good. I'm not aware of Penfolds turning down any fruit that makes that benchmark, although I suppose a grower could contract only a certain area of grapes to Penfolds and keep the rest for other uses.

[Mahmoud Ali]

There is some sort of agreement in place that must be mutually beneficial because if it was just one sided, then there is no reason for them to enter into the contract. Maybe that contract states they'll buy X amount of Y graded grapes at Z price each year...as long as Penfolds gets first right of refusal on all A+ graded grapes and that bulk growing is what keeps them afloat....Maybe the actual amount for grapes used for Grange is a huge amount per ton...Given the wine sells for 600 a bottle, that gives Penfolds a whole lot of room...

Don't overthink it Polymer. Except in the most extreme circumstances almost all contracts benefit both sides. For one thing, I don't think Penfolds buys fruit solely for the Grange, they buy grapes for their entire stable of wines, from Koonunga Hill to the Grange. Because of that they likely contract for grapes from many growers and vineyards and take all their fruit and use it accordingly, selecting the best lots for the Grange and working it down the line as Craig has already said. With long term contracts they likely do not abandon their growers, leaving them to fend for themselves with extra fruit on hand.

Mahmoud.

[Polymer]

I don't think there is ever a case where these growers don't have places to sell A+ Graded fruit....and I'm sure Penfolds doesn't guarantee buying any fruit that comes from the vineyard..

[crusty2]

I have heard of cases where fruit was originally graded as A+ in the vineyard and then being downgraded at the weighbridge. Not sure what rights the grower would have in this case.
Article here on payments https://www.farmonline.com.au/story/6197312/ ... m-wineries
It would not surprise me that the larger companies finance departments would take the full 9 months before making a payment for any grape receipts. Not sure if they make a full payment or just a part payment to comply with the "rules". If you have a long term contract you cannot complain too loudly, just suffer in silence.
Growers may be able to utilise some of their fruit for own labels as a backup for slow or late grape payments.
If a vineyard is used 4 out of 5 years for a top wine, then the 1 out of 5 was downgraded at the vineyard or at the weighbridge

[Mahmoud Ali]

Okay, lets put this to bed, at least about Oliver's Taranga, their HJ Reserve, the super premium M53, and Penfolds, the reason I have been posting. Here is what Therese Dixon, one of the cellar door managers has to say about their contract with Penfolds and the grapes that go into the making of Grange (yes, I did write to them).

"Oliver’s Taranga Vineyards are producers of premium grapes for wine and have been producers for 175 years. This year, this premium land has been in family hands for 180 years. Penfolds have an ongoing contract for 60% of our grapes overall, which include half of our old Shiraz blocks.The Shiraz grapes that Penfolds’ has used for 16 vintages since 1989 come from a couple of parcels of our old Shiraz blocks. We also use fruit from these blocks for our M53 and our HJ Shiraz."

Penfolds have an agreed tonnage that they take from our old Shiraz blocks annually, as well as the other varieties that they are contracted. They take their annual allocation and then grade after they collect it using a 3 tiered system; obviously the top tier goes into Grange, so if our grapes aren’t graded into the top tier that year they go into one of their other premium wines, eg: St Henri. We don’t find that out until later in the vintage year when the bonus is then paid for fruit that makes Grange. As I said that has been 16 years for Oliver’s since they started paying bonus’ and recorded the suppliers, sometimes they also choose Shiraz for Grange from our other blocks in addition to our HJ block.

Imagine that, sometimes the shiraz from other blocks (i.e. not the old Shiraz blocks) also make it into the Grange. Anyway, I think it is safe to say that buyers of the HJ or the M53 have nothing to fear about Penfolds buying affecting the quality of the wine.

I think that what Therese has told us could be assumed to be a good template for how the more stable, medium to long-term contract work.

Back to egregious pricing.

Mahmoud.

[phillisc]

Not sure if it should go here, but it is in the same
vain as the Taylor's. Better brand I believe, better fruit source ect ect...still $ 2,000 per bottle (magnum)

https://www.therealreview.com/2019/09/11/pet ... terstroke/

So the Lehmann Masterton is made from a parcel of the vineyard, from fruit that would normally be used in the Stonewell. If the fruit is that much better, then intuitively the Stonewell is equivalently diminished. Of course one should take into account that the Stonewell is made in larger quantitities and the dimunition is therfore spread out.

An email today;

"MASTERSON has been crafted to embody the strength and spirit of the Barossa community and the camaraderie forged over decades with generations of family grape growers. It is the continuation of these treasured relationships that enables our winemakers to hand select...vintage after vintage.

Limited to only 1000 magnums, MASTERSON has been released...as a tribute to Peter's strong community values"

At 2 grand a pop, from the 2015 vintage! Makes 111A a bargain, even some cash left over for lunch

Cheers Craig
PS, this could also go in the other thread...BS category

[thebrady28]

Just got the same email about the Masterson - was quickly deleted.

[JamieBahrain]

The Masterson sound delicious. I'd like to drink it with mates in front of a good game of footy. If I win lotto I will.

[Mahmoud Ali]

So no mention of the vineyard - in direct contrast to what was said to Huon Hooke.

Here is the relevant part of his article:

John Casella had given the winemaking team a brief: “Give me the best Barossa Valley shiraz possible.”

PLW has 130 grape-growers, and there are some stunning old vineyards among them, so there was plenty to choose from. The winemaking team settled on a parcel of fruit from Glen Hammerling’s vineyard at Moppa in the north-western Barossa. Glen Hammerling has been a Lehmann grower for many years and his fruit regularly goes into the Stonewell blend.

The Masterson wine came from a special low-yielding section of the vineyard. It spent two weeks fermenting on the skins and was matured in a brand-new François Frères 2,500-litre foudre for 36 months before bottling into 1,000 magnums.

According to this, from among the 130 grape-growers, some with "stunning old vineyards" the settled on a parcel of Mr Hammerling's vineyard to make the Masterson. Okay so far, right? But wait, Hammelings fruit regularly goes into the Stonewell blend. If the Stonewell is always made from Hammerling's fruit then clearly the Masterson diminishes the Stonewell. However, considering it may also be a blend, as mentioned by Huon Hooke, then it is likely made from a selection of the old vine sources. This leads me to say that since the Stonwell was a blend from all their vineyards, then Mr Casella asking his winemaker to "Give me the best Barossa Valley shiraz possible implies that the winemaking team weren't doing it for the Stonewell. And if they were, then the Masterson couldn't be the best, only different.

I think you're right about the BS Craig.

[Matt@5453]

Not sure if it should go here, but it is in the same
vain as the Taylor's. Better brand I believe, better fruit source ect ect...still $ 2,000 per bottle (magnum)

https://www.therealreview.com/2019/09/11/pet ... terstroke/

So the Lehmann Masterton is made from a parcel of the vineyard, from fruit that would normally be used in the Stonewell. If the fruit is that much better, then intuitively the Stonewell is equivalently diminished. Of course one should take into account that the Stonewell is made in larger quantitities and the dimunition is therfore spread out.

An email today;

"MASTERSON has been crafted to embody the strength and spirit of the Barossa community and the camaraderie forged over decades with generations of family grape growers. It is the continuation of these treasured relationships that enables our winemakers to hand select...vintage after vintage.

Limited to only 1000 magnums, MASTERSON has been released...as a tribute to Peter's strong community values"

At 2 grand a pop, from the 2015 vintage! Makes 111A a bargain, even some cash left over for lunch

Cheers Craig
PS, this could also go in the other thread...BS category

Whats wrong with 2015 Craig?

[sjw_11]

"MASTERSON has been crafted to embody the strength and spirit of the Barossa community and the camaraderie forged over decades with generations of family grape growers. It is the continuation of these treasured relationships that enables our winemakers to hand select...vintage after vintage.

I love to celebrate friends and family by drinking unaffordable wine on my own that no normal person will ever get to drink.
If they wanted it, they should have worked harder.

[phillisc]

So the Lehmann Masterton is made from a parcel of the vineyard, from fruit that would normally be used in the Stonewell. If the fruit is that much better, then intuitively the Stonewell is equivalently diminished. Of course one should take into account that the Stonewell is made in larger quantitities and the dimunition is therfore spread out.

An email today;

"MASTERSON has been crafted to embody the strength and spirit of the Barossa community and the camaraderie forged over decades with generations of family grape growers. It is the continuation of these treasured relationships that enables our winemakers to hand select...vintage after vintage.

Limited to only 1000 magnums, MASTERSON has been released...as a tribute to Peter's strong community values"

At 2 grand a pop, from the 2015 vintage! Makes 111A a bargain, even some cash left over for lunch

Cheers Craig
PS, this could also go in the other thread...BS category

Whats wrong with 2015 Craig?

Not a lot Matt from the various bits and pieces that I have had, but have had many more wines from 14 and 16...may have been a better choice. However, you are probably right in the long run it will be ok. Can't see this wine doing much in the long term, I will be long gone before it sees a decent return.
Before all the old world fans jump up and down about Bordeaux and Burgundy prices, at least wines from those regions have come off the very long run.
What will the '16 and '18 and beyond Mastersons be, $2500, $3000 or more....just silly. Think Mr Castella is having a lend.
Cheers
Craig

[Matt@5453]

An email today;

"MASTERSON has been crafted to embody the strength and spirit of the Barossa community and the camaraderie forged over decades with generations of family grape growers. It is the continuation of these treasured relationships that enables our winemakers to hand select...vintage after vintage.

Limited to only 1000 magnums, MASTERSON has been released...as a tribute to Peter's strong community values"

At 2 grand a pop, from the 2015 vintage! Makes 111A a bargain, even some cash left over for lunch

Cheers Craig
PS, this could also go in the other thread...BS category

Whats wrong with 2015 Craig?

Not a lot Matt from the various bits and pieces that I have had, but have had many more wines from 14 and 16...may have been a better choice. However, you are probably right in the long run it will be ok. Can't see this wine doing much in the long term, I will be long gone before it sees a decent return.
Before all the old world fans jump up and down about Bordeaux and Burgundy prices, at least wines from those regions have come off the very long run.
What will the '16 and '18 and beyond Mastersons be, $2500, $3000 or more....just silly. Think Mr Castella is having a lend.
Cheers
Craig

Agree, 14 good, 16 better, 18 even better, 19 some seriously concentrated red wines.

On a side note lots of casella signs on vineyards in the Clare Valley now.

[felixp21]

I'd be interested as to how many people have had a mature Chave Hermitage from a top vintage, yet go on to buy this wine.
I picked up a case of the 2009 at release for the equivalent of $305 a bottle. I could have got magnums for not much more than $620, I can't remember the exact price but they were about that. In other words, you could buy three magnums of Chave for the price of one of these.
Like, come on, all of a sudden you can take a few plots of the stuff that Stonewell is made out of and charge 15 times the price. I promise you, most wine lovers are not total fools.
I assume that this is aimed at the Chinese (HK) market, in which shiraz purchases are dropping like a stone. I just find this strategy hard to explain, other than the FTA with China.
To me, it is quite bizarre.
I'm not sure it's been crafted to embody the strength and spirit of the Barossa community, more likely it has been crafted to add to the strength of the Lehmann bank account.

[sjw_11]

I'm not sure it's been crafted to embody the strength and spirit of the Barossa community, more likely it has been crafted to add to the strength of the Lehmann bank account.

If one were to be charitable (IF) then you could wonder if they intend to mostly give these bottles to their treasured suppliers and the headline price is just a marketing gimmick to help justify their position as a high quality winery but not something they expect many people to actually ever pay.

I would note, even at this inflated price selling all the bottles would only add <0.4% to Casella's revenue (although if you assume 60% profit then it could add more like 4% to their profit, but given it is a private company it is hard to know what that profit is net of, e.g. family salaries, rents paid for properties owned by other companies, etc).

But even if so its still a "cheap" gimmick.

[felixp21]

1000 magnums = 2000 bottles, so selling it at $1000/bottle.
Stonewell sells around $60, which is what they would have got for the wine if it was sold as such. (Langton's Fine Wines selling the 2012 for $63)
costs should be pretty much exactly the same, I guess depending on how much new oak they use.
So, they are making an extra $940 a bottle for 2000 bottles (1000 magnums)
That is over $1.8 million straight to the bottom line. Pretty handy, I would have thought. Nice little earner. As you say, if the NPAT of Casella is around 30m, then it's a significant increase, particularly for a company trying to sell itself to the Chinese.

Any company only making 60% profit on a wine selling for $1000 bucks a bottle (it is, after all, fermented grape juice) need to change their management yesterday.

[sjw_11]

I was just trying to be open minded in my scathing criticism of stupid pricing

Anyway all of this assumes they can actually sell the damn thing. You don't make any profit on unsold wine.
I think the gimmick alone might be seen as helping sell themselves to the Chinese ... a super Iconic wine the new owners can exclusively control.

[tarija]

The Masterson is not about lifting profit from the sale of Masterson.

It acts as cheap publicity (wine would have cost the same to make as Stonewell), thus lifting sales of the whole Peter Lehmann range. The normal range is the bread and butter of the business. Even at a manufacturing cost of $50/magnum, total cost is $50k for the thousand magnums...Casella can afford to sit on the entire inventory, $50k is nothing to them.

Masterson also serves to lift the "prestige" and reputation of what is a mid-tier brand in a large sea of similar brands, they will look to raise the prices on some of the mid and upper tier wines.

The outrageous price is a masterstroke. Far less people would be talking about this if it came out at $500...and hardly anyone would be buying at $500 anyway.

[Mahmoud Ali]

Masterson also serves to lift the "prestige" and reputation of what is a mid-tier brand in a large sea of similar brands, they will look to raise the prices on some of the mid and upper tier wines.

I'm sure you're (edit) right, in that some people will see the wine as a signifier of quality in the rest of the range. However, for real wine enthusiasts it goes over like the Penfold's Ampule, lots of show and a signifier of nothing. Hard to respect pomp and show from a winery. Compare that to Wendouree and Rockford, wineries that command nothing but respect and reverence.

[JamieBahrain]

Before all the old world fans jump up and down about Bordeaux and Burgundy prices, at least wines from those regions have come off the very long run.

I'm not sure of your point here Craig? Old World drinkers in defence of this wine? I consider myself a collector of Old World wines and have never had to pay anywhere near this price for the greatest wines of Piedmont. Even now my favourites cheaper than Aussies.

Marketing aside, many wealthy people don't immediately like classic Old World wines.Think of where you'd go from drinking very young Grange.

[phillisc]

Before all the old world fans jump up and down about Bordeaux and Burgundy prices, at least wines from those regions have come off the very long run.

I'm not sure of your point here Craig? Old World drinkers in defence of this wine? I consider myself a collector of Old World wines and have never had to pay anywhere near this price for the greatest wines of Piedmont. Even now my favourites cheaper than Aussies.

Marketing aside, many wealthy people don't immediately like classic Old World wines.Think of where you'd go from drinking very young Grange.

Yes Jamie, could have been a fraction clearer, and no issue with the old world collectors, would like to be more of one myself.


My reference to old world wines was a reflection of price, nothing to do with super Tuscans, Italians, Germans, French or anything like that. I still don't agree with dropping 2, 3, 4 grand or more on a Cabernet or a Pinot, however, there is a shit load of difference between pedigree and form, compared to greed or just silly showmanship in the case of the Masterson...to simply lure in big players on the pretense that we are special, when lets face it, most of the portfolio is just good ordinary drinking, apart from perhaps Stonewell and Morris very old.
The scenario reminds me a few years back of a winery in the Coonawarra (which I believe no longer exists) when a first vintage 'super premium' Cabernet was released at $100 when there was nothing else in the district that was remotely near it at the time. That one ended really well, one of the best piss takes that i have seen in while

I would like to get into the international market a little more, but it requires effort and energy to do the homework...something I don't probably have a lot of, especially from the other side of the world and with the price required to procure.

Anyway my 2 cents...looking forward to a lunch next week at Vintners followed by lazy afternoon of tasting.
Cheers Craig.

[cteague]

If the Stonewell is always made from Hammerling's fruit then clearly the Masterson diminishes the Stonewell. However, considering it may also be a blend, as mentioned by Huon Hooke, then it is likely made from a selection of the old vine sources. This leads me to say that since the Stonwell was a blend from all their vineyards, then Mr Casella asking his winemaker to "Give me the best Barossa Valley shiraz possible implies that the winemaking team weren't doing it for the Stonewell.

Having growers on the book doesn't imply having access to their best lots of fruit, and particularly at a rate that is viable to throw into a $60/70 bottle of red. For example, it's possible Hammerling's best rows were finding their way into Grange & co, and only after getting permission to "spend what's required to get the best" can the PLW team afford access this fruit. Which does go hand in hand with your last point - the team probably weren't making the best possible wine they could for the Stonewell, simply the best wine they could given the grapes they could reasonably afford.

That does pose a bigger question though - if the winemaking team haven't previously had access to the best of the best fruit, how could one reasonably expect them to maximise the use of it, on what's essentially a first attempt? I'm guessing this isn't the type of consideration the target market is giving to this product though...

[Matt@5453]

That does pose a bigger question though - if the winemaking team haven't previously had access to the best of the best fruit, how could one reasonably expect them to maximise the use of it, on what's essentially a first attempt? I'm guessing this isn't the type of consideration the target market is giving to this product though...

I would suggest they have been working towards it, potentially with trials being performed over a number of vintages (e.g, with oak, time on skins etc). Whilst good fruit is required - top quality oak is also a requirement, they would have worked with coopers to perfect this.
The 2015 probably stood out as 'the wine' to release. Winemakers tend to be a proud bunch, in this instance they would have wanted the resources to make it happen (putting a $2000 price tag on bottle of wine which is essentially your own work needs resources). Then they wait nervously trusting the wine stands up in the market place.

[sjw_11]

What fresh hell is this? (spotted in Heathrow Terminal 5 while I was killing time connecting from CPT to CDG)... Sapphire Label??

PS sorry for the picture being sideways, not sure why it did that

IMG_1446.jpg

[phillisc]

Sam, perhaps Sapphire is much more market friendly to the well heeled and misinformed than plain old black
Aussie currently sitting at 50.9 p...after the money changers get their cut, that bottle is going to cost $130+


Cheers craig

[Mahmoud Ali]

If the Stonewell is always made from Hammerling's fruit then clearly the Masterson diminishes the Stonewell. However, considering it may also be a blend, as mentioned by Huon Hooke, then it is likely made from a selection of the old vine sources. This leads me to say that since the Stonwell was a blend from all their vineyards, then Mr Casella asking his winemaker to "Give me the best Barossa Valley shiraz possible implies that the winemaking team weren't doing it for the Stonewell.

Having growers on the book doesn't imply having access to their best lots of fruit, and particularly at a rate that is viable to throw into a $60/70 bottle of red. For example, it's possible Hammerling's best rows were finding their way into Grange & co, and only after getting permission to "spend what's required to get the best" can the PLW team afford access this fruit. Which does go hand in hand with your last point - the team probably weren't making the best possible wine they could for the Stonewell, simply the best wine they could given the grapes they could reasonably afford.

That does pose a bigger question though - if the winemaking team haven't previously had access to the best of the best fruit, how could one reasonably expect them to maximise the use of it, on what's essentially a first attempt? I'm guessing this isn't the type of consideration the target market is giving to this product though...

My answer to your post can be found in some of my posts above, regarding how supply contracts usually work and what was said about how they selected the parcels from which the Masterson was made.

[Mahmoud Ali]

What fresh hell is this? ........... Sapphire Label??

My thoughts exactly Sam, however on an unrelated quest I came across information about the Sapphire Label and I see that they may not be another tier in their multi-colour blends but rather single vineyard wines. The one in your picture says St John but they also make a Dorrien, Lyndoch and Moculta Shiraz, each a A$120 at the Ben Ean cellar door - so about the same as the duty free price.

Mahmoud.

[A_Steady]

The St John is nice, they were serving it at the Qantas Sydney First lounge a few years ago - the ‘12 vintage iirc