Hitting the right price point is key to success for wines from Med

By: | at 08:00 PM | Channel(s): International Trade  Logistics  

Italian imports growing, low-key southern French wines making inroadsBy Peter A. Buxbaum, AJOTThey’re not exactly breaking all-time records, but in an environment where imports are plummeting in many areas, imports of wines from the Mediterranean region are holding their own and even showing some small increases.
Mediterranean wines conjure up images of imports form Italy, and they are, of course, the largest contributor of shipments from that region. In fact, Italy leads all countries in exports of wines to the United States. But newer wines from southern France, bearing improbable labels like Fat Bastard and Red Bicyclette, are also making inroads, while shattering the image of the snooty, sophisticated French wine suitable only for connoisseurs.
“Italy is the biggest source of imported wines for the United States,” said Geoff Giovanetti, managing director of the Wine and Spirits Shippers Association, a cooperative based in Reston, Va. “We have seen a little bit of growth in that area, and that is significant, because so many industries have just tailed off over the last year and their products represent a fraction of what used to come in.”
WSSA, which bundles its members’ volumes to negotiate favorable shipping rates for importers, recently transitioned its operations department to Albatrans, an Italian international freight forwarder.
Italy’s continued success in marketing wines in the United States can be attributed to the “good spectrum of products” that country officers, said Giovanetti, and in that they “are hitting the right price points.” They are also helped by the fact that wine consumption has increased a percent or two in the last year among Americans. Other Italian consumables are also gaining US market share.
Price appears to be a key to success in marketing imported wines to cash-strapped Americans, as witnessed by the success of some lower-priced, low-key wines coming from the south of France.
“We’ve seen some growth out of France,” said Giovanetti. “They’ve learned to make some inexpensive wines which they ship out of the Mediterranean port of Fos sur Mer,” about 30 miles from Marseilles.
Meanwhile, Australian wines, which were the main rival to the Italians in terms of US import volumes, are down 10% this year. The Australians “were poised to take over a few years ago,” said Giovanetti, but apparently are not in a position to give the Italians a run for their money in the current environment.
The newcomer French wines source grapes from vineyards in the Languedoc region of southern France. The Fat Bastard label, which sports a logo in the form of a white hippopotamus, is meant to shatter the pretense associated with French wines, as well as the assumption that they must be expensive. Fat Bastard, which produces Cabernet Sauvignons, Chardonnays, Merlots, Pinot Noirs, rosés, Sauvignon Blancs, and Syrahs, picks grapes from Languedoc districts of Gard, Hérault, and Aude.
Red Bicyclette, which is distributed in partnership with the E. & J. Gallo Winery of California and is meant to evoke the relaxed, slow-paced lifestyle of southern France, sources from Herault and Gard in Languedoc and produces Pinot Noirs, Chardonnays, Syrahs, Merlots, and rosés.
“These are quite a large departure from form the typical old-line French chateau wines that have sold French wine forever,” said Giovanetti. “They take pride in their wines, and rightly so, but they have no idea about appealing to a mass market.”
The gains registered by Mediterranean wines in the current market is all the more impressive in view of the fact that shippers are not enjoying the same kinds of rate concessions which have prevailed in other trade lanes. Although carriers on some shipping routes have been falling all over each other in their efforts to knock rates down, that has not been the case on the Mediterranean, in the experience of the WSSA.
“The Mediterranean is volatile,” said Giovanetti. “The Med itself is really on everybody’s path going from Asia to Europe. Some

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Peter Buxbaum has been writing about international trade and transportation, as well as security, defense, technology, and foreign policy, for over 20 years. Besides contributing to the AJOT, Buxbaum's work has appeared in such leading publications as [em]Fortune, Forbes, Chief Executive, Computerworld, and Jane's Defence Weekly[/em]. He was educated at Columbia University.