There’s a very simple answer to this, and it took sitting with Delfim Costa of Enoforum Wines to have it explained to me.
In other places around the world, the cost of labor and goods isn’t anywhere near what it is in the US. As a result, great wines of regionality and careful crafting can be purchased for a fraction of the cost of an American wine.
I was reminded of this as I just heard a story on the news about a car manufacturing plant that may soon shut down in California. A worker talked about how he’s greatly concerned. He’s currently making over $30 an hour and doesn’t know what other job would provide that kind of salary for him, as he’s so specialized. I couldn’t help but wonder, “What are workers being paid in Mexico, for instance, per hour for working on assembly lines?” I dare say a whole lot less. Perhaps the cost of goods is about the same for steel? I really don’t know about that, but I can see where just bringing down labor costs will save a car manufacturer a lot of money, given the US $30/hour, converting to pesos, the cost of land, insurance, and health care – if it exists, etc.
FAST FORWARD to wine imports: With land, labor, and cost of good prices being significantly less, wines coming from other countries are great values, and this is what people are discovering. The Millennial generation, who haven’t become set in their ways and are lot more adventurous that the boomers, the x’s, and the y’s, are out exploring, and import sales are reflecting that in an uptick growth spurt.
According to Delfim, between 2003-2007, global exports of the Portuguese Table wines increased by 38.6 percent, with the US seeing an increase of these wines by a whopping 77 percent. (The UK and Germany are other growth areas of significance for Portuguese wines.) It will be fascinating to learn what 2008-2009 has delivered in Portuguese wine sales, if this is all pre US recession.
What sells for $9.99 from Central Valley fruit is a lot less regional, getting put into bulk wine, losing all aspects of hand crafting and any regionality relationship to California, and yet a $9.99 bottle of wine from Alentejo, Portugal is a wine of great character, flavor, and quality. The same holds true for other imports as well, but Delfim Costa was my point of learning, and this is why he’s given credit in this story…. He’s the one who has educated me to a reality I hadn’t ever considered or understood.
The tide of exploration and discovery is turning toward imports in this economic downturn. Meanwhile, US growers and producers may find a more leveling of the playing field. I can’t image that everything in the world will be homogeneously priced for cost of goods, services, and labor any time soon, but the world is ever-so-slowly moving in that direction… It will take many, many years before the world is primarily segmented into… this country mostly does this (services), this country mostly does that (manufacturing), and that country handles most of that (economy).
I’ve pondered globalization since the 1960’s. I’ve seen a lot of changes and I know there are lots more to come. Meanwhile, I’m enjoying domestic and – now – import wines, as I give in and become part of the globalization process, too.