Australia - the most expensive imported wines in the world?

[GraemeG]

A couple of days in Singapore gives me cause to reflect on the prices of imported wines in this country. We have usurious taxes here, and it certainly doesn’t help the wine lover who wants to drink wines different in style than those made here – at least for a reasonable price. A few minutes from my hotel in Singapore I came across the ‘Carrefour International Wine Fair’ in a large shopping complex. It was an eye-opener I can tell you. I’ll concede there wasn’t much in the way of ‘great wines’ (first growths & grand crus) but there was much to be learned. We rarely see 2nd wines of Bordeaux chateaux here in Oz, but here were lots of examples, from good estates, at sensible prices. 02 La Dame de Montrose, 01 & 02 Reserve de la Comtesse, 01 Tourelles de Longueville; all for around A$35. Better bargains I found at higher levels – how about 97 Leoville Barton for $65, 2001 Grand Puy Lacoste for $60, even 2001 Pichon Baron for $75. I tell you, on a level playing field, the value for money equation between the wines of the world shifts dramatically. For the same money, would you rather one bottle of 01 Pichon Baron, or 2 bottles of 02 Penfolds Bin 138? Because that’s the economics in Singapore.

The cheapest shelf price I’ve seen in Sydney for 2000 Lascombes is $110 (OK, Langton’s are showing a hammer price of around $80, which = $92 sold). In Singapore, try $70. Perhaps it’s something of a tribute to the local industry that they can get respectable wines on the shelf for $20, after including 40% worth of taxes. (Singapore GST is 5%.) On the other hand, it says something for their lack of influence that the wine industry managed to let itself get saddled with this outrageous level of government theft in the first place.

Makes me think the best place in the world to buy wine is a non-wine-producing country with a moderately weak currency. I wonder just where that is?

cheers,
Graeme

[Glen]

Hi Graeme

the best place in the world to buy wine is a non-wine-producing country with a moderately weak currency

I am afraid a 'catch-all' formula like that does not exist, think of Thailand where there is 200% wine tax
Perhaps they are anxious to protect their wonderful wine industry, afterall they have two vintages per year, but at 10b per bottle, it was not good value.

Cheers
Glen

[Grant]

Graeme,

This inequity has bothered me for a long time. I remember when I visited Guigal in 2002 and buying some wines on the way out, paying 5 euro's for the Cote du Rhone, 10 euro's for the CNDP and 18 euro's for the Cote Rotie ( the OZ dollar was 20% stronger against the euro then too). Get home and the CNDP is $70 and the Cote Rotie $90-$110. The numbers just don't stack up.


Cheers

[andyc]

Having just come back from France where Carrefour and other supermarkets and smaller wine merchants were having their wine fairs the difference in price was incredible with prices the equivalent of 35-50% of Aus retail prices. Why is this? Could it be that although there are high taxes etc the middle men and some retailers are taking the approach that since true wine enthusiasts will always want to try good European wines for their different characteristics that they'll be prepared to pay whatever they charge? How does a 5 Euro bottle of Guigal Cotes Du Rhone end up at A$19-27 in Aus? Or a 14Euro bottle of Chateau Cantemerle end up.... (?)

PS. NZ is usually much cheaper as I believe (please correct me if wrong) they have a flat tax on imported bottles rather than a % scale. I have bought V Girardin Santenay Les Gravieres there for NZ$35 and have seen it retail for A$57 here!!

[Gianna]

Last year in Canada I paid the equivalent of $78 AUD for the 1999 Wolf Blass Platinum..

Anyway, I bought all of them (7 bottles) , drank 3 with a cousin during my stay and left the rest with him as payment for using his car around Toronto for the week.

I was astounded to find the price back in Melb at over $140 pb.

[Red Bigot]

Last year in Canada I paid the equivalent of $78 AUD for the 1999 Wolf Blass Platinum..

Anyway, I bought all of them (7 bottles) , drank 3 with a cousin during my stay and left the rest with him as payment for using his car around Toronto for the week.

I was astounded to find the price back in Melb at over $140 pb.

I suspect the basic reason for both situations (expensive imports and some Oz wines cheaper O/S) boils down to the same thing: taxation and marketing.

Taxation certainly seems to explain some of the difference, but the remainder is due to demand exceeding supply on many wines at the premium levels. As long as Oz wine buyers keep buying the wines at the high prices the producers/importers/marketers will continue to charge whatever they can get away with.

Maybe it's an indication of the range of sophstication of some wine buyers when some smart ones pick up imports at auction at (much) less than the original retail price and some (less smart) others pay significantly more for wines at auction than they would pay at currently available retail.

There is still a degree of rationalisation of brands and prices to occur, we've had Jamiesons Run vineyard reds cut to about half price and many other examples, how long can Fosters let the Lindemans Coonawarra trio languish on the shelves? What happens if the sharemarket continues to dive for a while?

[GRB]

The Lindemans thing is interesting. I have some Fosters shares and to "Celebrate" the Southcorp take over they have offered some premium wins to shareholders. 2 of which are Pyrus and Limestone ridge. The offer on the surface looked good at $116 off rrp, but shopping around a little revealed that they were still cheaper else where. Then yesturday received a call saying they had discounted another $15 dollars off (Me thinks the original offer didn't fly that well). Still knocked it back, another $20 off should do the trick and make it worthwhile, I will wait and see

Glen

[Red Bigot]

The Lindemans thing is interesting. I have some Fosters shares and to "Celebrate" the Southcorp take over they have offered some premium wins to shareholders. 2 of which are Pyrus and Limestone ridge. The offer on the surface looked good at $116 off rrp, but shopping around a little revealed that they were still cheaper else where. Then yesturday received a call saying they had discounted another $15 dollars off (Me thinks the original offer didn't fly that well). Still knocked it back, another $20 off should do the trick and make it worthwhile, I will wait and see

Glen

Interesting, what was the final pb price offered? (answered by PM, thanks Glen) I have a friend who usually mentions the Fosters shareholder offers, but he hasn't told me of this one. I bought some 98 LR and Pyrus when it went down to $29-$30, might be tempted on the 99's if they get that low again.

[Raymond W]

I am not sure what the taxes on wines are in Japan, but there is certainly some inconsistency in the retail prices of Aussie wines that can be sourced here. This cannot be explained by the wine taxes alone.

Here are some random examples to illustrate the point:

Cullen DM 2002 4,800 yen (A$55)

Penfolds Bin 389 2003 2,900 yen (A$33)

Wynns Black Label 2001 3,330 yen (A$38

Peter Lehmann Stonewell 1999 6,500 yen (A$75)

Katnook Cab 2001 2,100 yen (A$24)

Balnaves Cab 1998 3,600 yen (A$41)

There are more examples and these wines are listed as the regular price by different wine retailers in Japan. I have chosen the cheapest that I can find in Japan for each wine, but you can see that some wines like Cullen DM are much cheaper than back in Oz while others are priced at a level similar to what I can get the wines for back home, and in some cases, some are actually more expensive in Japan! I find that is usually the case for many of the cheaper wines that I have in my cellar, e.g. basic Howard Park, Peter Lehmann, Yarra Ridge, Balnaves etc. They cost a little more than back home.

I wonder if this inconsistency has more to do with the profit margins set by the different respective wholesalers here in Japan.

[JamieBahrain]

I purchased some St Henri yesterday, from Kota Kinabalu Duty Free for $34 AUD!

Now, go figure, the same wine, an Australian wine, duty free in Melbourne airport is near $60AUD.

[GraemeG]

I am not sure what the taxes on wines are in Japan, but there is certainly some inconsistency in the retail prices of Aussie wines that can be sourced here.
...
I wonder if this inconsistency has more to do with the profit margins set by the different respective wholesalers here in Japan.

Can't believe the taxes are that high. Agree that the local (Australian) market gets gouged on the expensive stuff - I'm prepared to concede the cheaper >$20 wines should be more expensive everywhere else in the world than here at home. But I'll bet imports are cheaper in Japan. Someone was complaining on the WLDG thread recently about Ridge Geyserville Zin in Tokyo priced at US$55. Anyone seen it in Oz for less than A$80? That's US$60. It stinks...

cheers,
Graeme

[Raymond W]

Graeme,

Methinks you are probably right about imported wines being more expensive in Oz.

I found the Geyserville Zin that you were referring to. Yeah, it goes for 6,090 yen or around A$70 (A$1=87 yen). The same retailer is also selling Devil's Lair Red 2000 for 4,725 yen (A$54) and a Balgownie Cab 1999 for 2,500 yen (A$29).

BTW, here are prices of some of the non-Aussie imported stuff that I have bought in Japan over the last 6 monhts (mostly French Pinots.) Using these prices as a guide, you can probably get a good idea of what the price differences are like between imported French stuff in Japan vs in Aust.

Louis Jadot Chambolle-Musigny 1er Cru Les Fuees 2001 9,450 yen (A$109)

Dujac Fils & Pere Chambolle-Musigny / Gevrey-Chambertin / Morey St. Denis 2002 all for 4,400 yen each (A$51)

Michel Gros Vosne Romanee 1er Cru Clos des Reas 2000 6,300 yen (A$74)

Geantet Pansiot Gevrey Chambertin 2002 4,500yen (A$52)

Coche-Dury Bourgogne 2002 4,500 yen (A$52)

Cloudy Bay Pinot Noir 2002 3,600 yen (A$41)

Frescobaldi Santa Maria Morellino Di Scansano 2003 2,300 yen (A$27)

I have also bought some entry level QMP Rieslings Kabinett from top German winemakers like Dr. Loosen, Von Hovel, and Fritz Haag. Their basic QMP Rieslings can usually be bought for between 2,100 yen (A$24) to 3,000 yen (A$34). Trimbach Rieslings can be found for around 2,200 yen (A$25.50)

Sorry, I don't know much about the prices for Bordeaux stuff and other European wines as until recently, most of the reds (C-thru Reds?) that I drink are French and Kiwi Pinots, and the whites have been Alsatian and German Rieslings, and Kiwi SBs.

Cheers,

Raymond

[Rob]

Was in Macau this weekend. A bottle of Dom perignon 1995 was $AUS 140. Needless to say I got a few.

Back to Hong Kong today. A bottle of 1988 Dom perignon was less than $250 a bottle at Oliver's on special.

[Golf&PinotNut]

You should try buying Australian wine in the U.S. A bottle of D'Arenberg Dead Arm retails for around US$65. That's AUS$86.74. For many of the "high dollar" wines that aren't imported into the U.S. in significant amounts, you'd almost be better off shipping them at $250/case in shipping costs.

[Adam]

You should try buying Australian wine in the U.S. A bottle of D'Arenberg Dead Arm retails for around US$65. That's AUS$86.74. For many of the "high dollar" wines that aren't imported into the U.S. in significant amounts, you'd almost be better off shipping them at $250/case in shipping costs.

The dead arm is pretty freely available for AUD$65 in the US...which is still a premium over the oz prices...wines like Shirvington, Noons etc all command big premiums there due to the Parker effect.

[TORB]

You should try buying Australian wine in the U.S. A bottle of D'Arenberg Dead Arm retails for around US$65. That's AUS$86.74. For many of the "high dollar" wines that aren't imported into the U.S. in significant amounts, you'd almost be better off shipping them at $250/case in shipping costs.

Hi GPN,

Good to see you "over here."

The general rule of thumb in regard to Oz wines is the US is that wines that cost A$XX in Oz cost US$XX in the US. That is despite the fact that we pay about 40% in tax which is not applicable for exported wines.

Part of the higher margin is due to your 3 tier system and part of it is profit.

The "rule" I talked about above does have its exceptions. Penfolds Bin 389 is about twice the price of say Bin 407 here, yet in the US they are priced similarly, so the 389 is great value in the US. Grange is less expensive on the US than OZ, as is the Wynns Black Label Cabernet.

Going the other way, wines like Kays Block 6 are more expensive as the importer pays full Oz retail to buy the wine. Others like the last Kalleske release which sold for US$70 whilst it was A$40 here were just about retailer and wholesaler gouging.

You are dead right about buying direct, a number of Oz wine lovers do it. Gavin who owns this site sells into the US too.

[Golf&PinotNut]

I know that there are a number of factors that explain how wine prices are set internationally. For starters, the U.S. Dollar is pretty weak right now thanks to some loosey-goosey international monetary policy set by our government (along with tons of domestic spending), which certainly impacts the price. I had no idea that you Aussies paid so much in tax on alcohol. Is that on all alcohol?

Am I the only one who thinks its ridiculous that I can spend less on a case of wine if I have it shipped 12,000 miles than if I buy it directly at my local merchant? That's crazy.

I have "spoken" with Gavin about direct shipments, but I have resisted the temptation to date. I have visions of a cartoon tattered cardboard box showing up on my doorstep with about twenty world postmarks... stickers that say "Tasmania," "China," "Guam," etc.

[Mike Hawkins]

GPN,

I have had a few dozen sent to NYC and they arrived in good condition. I am confident what you'll buy from Gavin will be in as good, if not better condition than what you get from your local wine store - after all, the latter still has to cross the ocean as well.

Cheers


Mike

[Adam]

Agree, I have had Gavin ship me a lot in Korea, the packing is superb and insulated, never had a single problem...except one large (12 cases I think) shipment getting rejected by customs!