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California Is Awash in Wine Bargains

October 16, 2006|Jerry Hirsch | Times Staff Writer

Colin Wellman, a pro beach volleyball player, usually leaps to block spikes. Lately, he has been jumping for wine bargains.

At the Culver City Costco in Marina del Rey, Wellman recently snapped up a bottle of private-label Cabernet Sauvignon from the highly regarded Stags Leap District of Napa Valley for $13.99. Wine from that area often costs triple that amount.

Wellman's purchase was "way better than what I usually get in my $10-to-$20 price range," he said.

Thanks to last year's record grape harvest, good California wine is flowing like water. Famous vineyards are selling their excess juice to intermediaries that are selling it under their own names or as house wines for retailers. Oenophiles like Wellman are getting better juice for their buck, uncorking fine vintages at prices not seen in years.

For now, the state's wineries seem "motivated to move inventories, and that's going to continue for some time," said Bill Turrentine, president of Novato-based Turrentine Brokerage, which arranges deals among wineries, grape growers and private-label bottlers. This year he's seen examples of bulk wine selling for less than what it would cost to grow the grapes, ferment the juice and bottle the wine.

"Lots of those wineries ... might not sell off the best of what they have, but it can still be very good," Turrentine said. "Sometimes these wineries get in a situation where the marketing people are saying they can't sell all the wine they have under their own label and the bankers say they aren't going to finance holding on to it."

But wine drinkers aren't likely to know what vineyard their juice is coming from. Wineries are reluctant to talk about what they sell on the bulk market, fearing that the revelation could damage their brand names and drive down their own prices.

Industry sources say some of the players selling excess wine are Bighorn Cellars, Caymus Vineyards and Joseph Phelps Vineyards, all blue-chip Napa Valley vintners whose wines retail for $30 to more than $100.

Established wineries could liquidate their inventories if they were willing to lower the price, but that's rarely the case.

"They don't want to wreck their brand for what turns out to be a temporary imbalance," said Joseph Ciatti, owner of the nation's largest grape and bulk wine broker.

Finding the bargains can sometimes be a daunting quest. Costco says it takes mere days to sell wines made by Cameron Hughes, a San Francisco wine trader who buys excess vintages from prominent vineyards and blends them to sell under his own name.

Using Costco and the Internet, Hughes sells wine labeled simply as a "Lot" with a number accompanied by the variety and geographic origin. When the lot is gone, he moves on to a higher number for the next batch.

At a Costco in Torrance recently, Dowd Walker was hunting for wine deals.

The 38-year-old Toyota manager drew rave reviews when he took a $9.99 bottle of Cameron Hughes "Lot 14" Napa Cabernet to a tasting party recently. Wine that good usually sells for $20 to $30, he said. Now, Walker is looking for more.

"I went back right after I bought the first bottle and Costco had not restocked it," Walker said. "I'm heading back this weekend."

Long Beach resident Don Snow found well-crafted Napa wine at even lower prices.

Snow packed his shopping cart with 24 bottles of $4.99 Napa River Chardonnay and Merlot at a Long Beach Trader Joe's last week. He thought the vintages could lubricate an upcoming homeowners association meeting.

"This will keep them happy," Snow said, sorting the wine into cardboard boxes. At $119.76 for two cases, the purchase was the cost of four bottles of a fine Napa Chardonnay.

Napa River is an offering by Bronco Wine Co., creator of the $1.99 Charles Shaw wines, better known as Two-Buck Chuck. The company's newest Merlot, Chardonnay and Cabernet Sauvignon wines are surplus batches sold by Napa Valley wineries and blended into bigger lots before bottling, said Fred Franzia, who heads Ceres, Calif.-based Bronco, one of the state's largest players in the bulk wine market.

"More wine is sold out of the back door in Napa than the front," he said.

The wine deals are expected to flow into 2007, said Geoff Nicoll, director of wine and spirits for the Bristol Farms supermarket chain.

Before a run-up in recent years, tippling was also easier on the wallet early in the decade because of a California grape glut caused by over-planting. The state's $16.5-billion retail wine industry recovered by 2004, and retail prices rose.

International competition -- there's lots of surplus wine worldwide -- is also helping to keep a lid on wine prices, said Annette Alvarez-Peters, who buys wine for Costco. The retailer is the nation's largest wine merchant, selling more than $800 million worth annually.

The overabundance of California wine has led to tastings galore for some traders.

"I am up to my ears in samples," said Ed Masciana, who bottles the Peralta Family Wine Co. varietals that sell for $6.99 at Bristol Farms. "I have not had this many choices of really good wine since 2001."

Owners of the higher-priced labels could find themselves losing sales to bargain brands if enough wine drinkers look for deals.

La Verne resident Darlene Sanchez, who drinks wine three or four times a week, is a bargain hunter. Recently, she has been quaffing $6.99 Peralta Sauvignon Blanc.

She said, "There are so many good wines out there right now in the lower price ranges. I don't think I could ever try them all."

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