39. The Grape Scoop - Wine Industry Happenings!

In Episode 39 of the 'Wineitupanotch Podcast,' we take a look at a variety intriguing happenings and developments in the global wine industry.

From important acquisitions and mergers, to the potential of "bots" in the hospitality sector, to the projected decline in wine production coming out of a major wine nation, an important upcoming auction and beyond, there is plenty to learn from listening to this episode!

After all, the business of wine is a big and important business!

NOTE: If you wish to register for the auction that is discussed in this episode, you can do so at www.drouot.com and www.interencheres.com !

Episode Chapters

00:00 Welcome 

01:35 Diving into Wine Industry News

03:54 Duckhorn Wine Company Acquisition

05:46 Robots in Hospitality

07:34 Wine Theft in Burgundy

09:35 Grand Cru Acquisitions

11:41 The Price Paid for a Legend is Revealed

13:03 Upcoming Industry Awards

14:24 France's Smallest Vintage in a Century

15:12 A Super Cool Upcoming Auction

16:57 Closing Remarks 

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Transcript

Anshu Grover: 

[00:00:00] 

Hello, and welcome to the Wineitupanotch Podcast, a podcast where we talk about wine, life and everything in between. My name is Anshu Grover, I'm your host and I am so thrilled that you've decided to join me today. Thank you for doing so. 

Welcome to Episode 39 of the podcast. I am almost there, we are almost at Episode 40, which is pretty exciting! 

I still harken back - you probably will hear me say this over and over again if you listen to these episodes - but I still harken back to when I first decided I was going to start this podcast journey of mine. And it's amazing that I've reached almost 40 episodes with you as a listener. Hopefully you've been on this journey with me for a while, and you've been enjoying this content. If you're somewhat new, you might find it amusing to go back to episode one, which I have actually not yet replaced. 

I keep thinking I should, because in that episode, I'm talking about what I think the journey is going to be like. And it has ended up being very different than that, but I'm still glad that I've done this and stuck with it. And I really do enjoy when I sit down with the podcast mic and have an opportunity to talk into effectively air, because I can't see you as you're listening, but all those messages and, um, you know, words of encouragement that I receive, all of those little tidbits of feedback really do power me and keep me going and keep me enthusiastic about speaking into this podcast mic. 

All that to say, we are almost at 40! 

I've got some old, backlogged content that I haven't been able to get to that I think I'm going to put some muscle around and finish editing and I'll probably do an interview episode for my 40th episode. So stay tuned for that. That's coming. 

But in the meantime, today, I thought I'd do something a little different. 

So the last two episodes have been quick tip episodes and they've been fun. 

Today, I wanted to bring you into my world, where my mind is always swirling with information and thinking about different things. I love to research and read about what's happening in the world and particularly in the world of wine. 

[00:02:00] 

And if you could see my computer, you would see that there are umpteen tabs open at all times. 

My husband sometimes walks into my office and makes copious amounts of fun of me for how messy my desktop looks and it's because I'm constantly looking at different articles and reading about the world of wine and what's happening in the world of wine. And I was about to close all these tabs because they've been sitting there for a while and I thought, well, why would I not just jump on to the podcast and share some of the interesting things that are happening in the world of wine that me, myself, I am keeping on top of and maybe have not been able to disseminate as fully as I'd like to. 

You know, I am putting my head around how I could maybe share a little bit more from a Wineitupanotch perspective. But in the meantime, while I figure that out, I thought, why not do a quick episode about some of the things that have been going on in the world of wine, particularly taking a business lens. 

Now all of the little stories I'm going to share with you in this podcast episode are not entirely all business-related. But I do think the underpinning here is that the wine industry, from my perspective, is a very important industry. It is a business at the end of the day and like all businesses, there are mergers, acquisitions, dispositions, changes in the industry, movement in trends - there's all sorts of things happening all the time. 

And sometimes as wine lovers, I think we love to romanticize the idea of wine. But, the more I spend time in the industry talking to people who work in the industry, the more that I have had conversations with people that are really emphasizing the importance of the business aspect, because at the end of the day, this is a thriving industry that employs a lot of people and a lot of people are reliant on. 

So with that, let me share a couple of the cool and interesting things that are happening in wine right now. 

I'm going to share them relatively quickly - this is just a high level overview to give you a bit of a sense of what's been up. And if you want to know more, please feel free to do the research and learn more about the stories that we're going to talk about.

[00:04:00]

Let's first start by considering a really important potential acquisition that's on the horizon. Duckhorn Portfolio, or Duckhorn Wine Company, is an extremely prominent producer in California. They are a publicly listed company and some of their brands will be familiar to you if you don't recognize the company name, although I think you will. The brands include Calera, Decoy, Duckhorn itself (the namesake wine) Migration, Kosta Browne, Postmark and others. So they're a really large publicly listed company. And in early October, they announced that they have accepted a cash offer valued at almost $2 billion from an LA investment firm to acquire the publicly owned company. 

 If this deal goes through (and it's not going to be for sure until about the Winter of 2025 so there's a couple of months left) but if this deal goes through, this public company will then be in the hands of an effectively private equity firm. 

And this is pretty important because the price that's being offered for the acquisition is ahead of what the shares are actually trading at at the time that the offer was made. 

And, you know what, this particular company was really only started in 1976 by Dan and Margaret Duckhorn so it's not incredibly old but today it's really grown. It has 11 wineries, 10 wine making facilities, eight tasting rooms and over 2200 acres of vineyards in 38 different estates. So it has become quite the powerhouse and obviously is very attractive from an investment perspective to this particular firm. 

So I think it's a very interesting story not only because of the fact that it's an investment activity in the industry, but also because it underpins how something starts humbly and grows to be so big and so important and such a nice return in about 50 years. 

The next story actually involves Tesla. This story comes from The Drinks Business, which is a very prominent industry publication, and they are talking here about the potential signaling of…. maybe let's say of the 

[00:06:00] 

end of somms (sommeliers) and bartenders. And what does Tesla have to do with that? 

Well, apparently at a recent technology industry event, CEO Elon Musk unveiled the latest version of their "Optimus" robots. And during this unveiling, the robots walked amongst the audience and spoke to them and really showcased that they have developed these conversational skills now in the robots. But most importantly, it was also showcased how the robots could be used in the hospitality and drinks trade, serving beverages to the audience present at the event. 

Apparently Musk actually talked about the fact that he could imagine a world where a bar robot would be given a comprehensive encyclopedic knowledge of wine, spirits, and beers, and then be able to offer the customer a bespoke service in a venue. 

And then at the event itself, there was a robot serving what looks like beer from a beer tap to attendees. 

So that's really interesting. I mean, it'll be interesting to see if this happens or not, but certainly, it's not so hard to imagine that with the growth and continuous evolution of AI and just computer technology generally speaking that there could be a time where machines, I guess, could outperform us as humans and really play a leading role in the hospitality industry when it comes to the serving and the explaining of wine. We'll have to see if, and when, that happens!

And our third story today is kind of interesting to me. 

Excuse me! If you can hear my dog barking in the background, he's decided he doesn't like what's going on outside and I probably won't know how to edit out his barking. So, my apologies! 

Anyways, um, one of the things that seems to be quite an issue within the wine industry, especially the fine wine industry, is theft. And I have to be honest, it's not something I had really thought about before I became an industry professional and really started spending a lot of time understanding the dynamics of the industry. But apparently theft of fine wines from the storage cellars that are kept within wineries is a more than, you know, optimally common thing. 

[00:08:00]

Let's put it that way. So I won't say it's common and happens all the time. But it does happen quite frequently. 

Interestingly, there was a ram raid in a village called Vosne Romanée in Burgundy not too long ago. Now Vosne Romanée, for those who don't know, is in the Côte d'Or of Burgundy which is really one of the most highly regarded villages. So the wines being made there are extremely expensive. 

And in this particular raid, the thieves made off with over 300 bottles of an estate's top wines. They were the Grand Cru bottlings that were actually destined for the U.S. Market. 

The robbery, which was deemed to be a violent robbery, occurred in the early hours of the morning, around 1:30 in the morning, when a vehicle reversed into the front doors of the Domaine in question. And for some reason, the alarms didn't go off and it's been reported that the images that were taken from surveillance cameras show that the anti-ram bar didn't hold up and that there were four hooded men that jumped out of the vehicle. 

They seemed to know exactly where they were going. And they went to a pallet stacked with the estate's Grand Cru bottles, and they took the bottles - 318 of them! According to a representative from the Domaine, that theft was worth around a hundred thousand Euro dollars, which is nothing to sneeze at. And the representative says that they literally smashed the door in, they filled the car up as far as they could and they took off and it was all done in four minutes. 

And this is not, as I mentioned before, that uncommon - it's not the first or last time that theft like this would happen and does happen. And as you can imagine, it's pretty devastating to those that are victim to this kind of crime. 

The next news story has an acquisition angle to it as well, but slightly different than the story that I just told you about Duckhorn. So in this case, let's talk about the Grand Cru sites in Burgundy, which are really the top sites within what is already one of the top areas in the world for the production of wine. 

Not too long ago, the big powerhouse LVMH snapped up a series of Grand Cru sites 

[00:10:00] 

and they ended up actually sparking a lot of outrage in the region because the land prices have become so high and it's so hard for anybody really to get into the area of Burgundy, or the Côte d'Or, without lots of money. But beyond that, even for the landholders to keep holding onto their land, Because of the tax implications that are kind of inherent in the laws of France, they end up having to pay a lot of money to hold onto their land and not to mention it's got good liquid value, so people sell it. 

So there's, you know, outrage that these top sites have gone to this huge company. But they've got the money to spend, right? So they dropped 15.5 million Euro dollars on a 1.3 hectares span of Grand Cru holdings across the region. 

They ended up acquiring three sites - one in Corton-Charlemagne, one in Romanée St. Vivant (which again is really top notch) and 0.3 hectares in Corton Bressandes. According to news reports, the three sites will now form part of LVMH's portfolio, although Domaine Poisot will continue to oversee viticulture in these sites. 

As I said, there is some discontent amongst the locals, with one person being quoted as saying, you know, I really think it would have been better if there were other wine growers, not people with a lot of money who could buy these domaines. 

And you know what? I think that's understandable. 

Having said that, I'm sure LVMH will be doing something pretty special with these parcels of land. Although at this stage they have yet to confirm the label under which they will be making wines from this newly purchased Grand Cru land.

And then continuing on with the theme of acquisitions…and since we're in France, why not continue looking at what's going on there? Another really huge news story, approximately a month old now, is that William Fevre from the area of Chablis (also in Burgundy, but further north than what we were just talking about) has been acquired by Domaines Barons de Rothschild Lafite .

[00:12:00]

Now the acquisition itself happened back in January 2024 but what is making the headlines a month ago and even now, is that the price that was paid has been revealed. 

And here's how it goes down. 

William Fevre has about 75 hectares of vines. 15.9 hectares are classified as premier Cru, 15.2 are Grand Cru, and the rest are village level vineyards, if you will. 

For this approximate 75 hectares of land, the Rothschilds paid USD $99 million for all of the property. 

Now that is definitely an eye watering amount, but let's not forget that William Fevre is one of the top-most producers in the Chablis region.

This acquisition is actually Barons de Rothchild's first move into Burgundy so it'll be interesting to see what they do with the estate and what they do from here. From their perspective, they've shared that to move into the area, they wanted to make sure that they were buying and partnering with a name that was commensurate with theirs, which obviously originates from Bordeaux. And they are very happy with the quality of the assets that they've bought. So it'll be exciting to see what happens from here!

And let's take a little bit of a turn here now in a little spot of fun. Wine Enthusiast magazine, which is definitely one of the most important sources of information and knowledge sharing in the wine industry - it's a huge name and magazine that a lot of people read carefully, myself included - Wine Enthusiast magazine magazine has announced nominees for its 25th annual Wine Star Awards. 

The Wine Star Awards are a very important set of awards that are granted in the industry. And definitely it would be fair to say that they are watched closely in terms of who's nominated and who wins. Awards that will be granted include Person of the Year, Winemaker of the Year, American and European Wineries of the Year, Lifetime achievement awards, Innovator of the Year awards and more along those lines.

And just to give you a bit of a sense of the caliber of people who have been nominated this year, we're looking at Ernst Loosen for Person of the Year. We're looking at Jean Charles Boisset, Paul Hobbs. 

[00:14:00] 

Winemaker of the year includes the winemaker at Shafer Vineyards and the winemaker and Head of Sustainability at Yalumba in Australia.

And that is just a small sample of the huge names that are part of this year's nominees. 

If you want to learn more, you can head over to Wine Enthusiast's website. They've listed everything there. And we can expect to hear who the winners of all the awards and all the categories of this process are sometime in January 2025.

Heading back to France, the Drinks Business Magazine recently reported that France has shared that they will be producing one of the smallest vintages in a century. The forecast is that the production of wine and France will likely decline by 18% year on year and 11% against a five-year average. 

And this is according to figures from the French government's agricultural statistics department. This decline is mostly weather related. So there were unfavorable weather conditions that have reduced production potential in almost all wine growing areas because climate change is really real and is having a real impact. According to this report, the most significant declines were in the vineyards of Jura, Charentes Val de Loire, and Beaujolais Bourgogne. 

And now let's close out this little news Roundup with a little spot of fun, shall we?

 If you are a fan of Burgundy and in particular, those really cool signs that are all over the highways and the main and side roads of the Burgundy region, you are going to love this! 

On Tuesday, November the 12th, almost 600 signs that are going to be divided into 300 lots will be auctioned off by the Burgundy Wine Board. Now, what do I mean by that? 

I literally mean the signs that have been on the roads for many, many years are being replaced and the Wine Board will be selling them in auction to raise money for the region.

The 600 signs that will be available will include Grand Cru, village and regional appellations, featuring the likes (for you Burgundy lovers out there!) of Grand Auxerrois, Côte de Beaune, Cotes de Nuits, Cotes Chalonnaise and the Maconnais. 

[00:16:00]

In total, the auction is going to feature 29 signs for Grand Cru appellations, 280 signs for regional and village appellations and 280 signs that simply say "Bourgogne" or have the B logo on them.

The auction is going to be live streamed so that'll be fun if anybody can tune in. And if you are keen to purchase one of those signs, you can do so by registering at the website, drouot.com and interencheres.com …..and I will put those in the show notes. 

As of now, estimations are that the Grand Cru appellation signs should fetch somewhere between 100 - 500 euros each, while other place name signs are going to probably generate somewhere between 50 and 300 Euro dollars each. 

If that seems a bit precious, signs showing the generic B logo for the regional Bourgogne appellation are being estimated to fetch about 30 to 50 Euros each so that's an affordable way to get in on this auction and get a tiny piece of Burgundy history if you want it. 

I don't know about you, but I'm thinking about maybe trying to sneak into this auction. I wouldn't mind having one of these signs in my possession! 

And with that, I will bring this Roundup of interesting things and news stories happening in the wine industry to a close. 

As I said, this may be the first time I've done this, but I'm always looking at these new stories with fascination. I love them. And to be honest, I still have a lot of open tabs that I didn't cover in this episode. There's always so much happening! 

If you found this episode interesting, I've got two things I want to share with you. One - please do let me know, because as I said, I'm always looking at these news stories and if things are interesting to you, I would love to know that because I'd love to share. And if not on the podcast, I could maybe find another way to share these types of stories with you and keep you up to date. 

Number two - if you do enjoy following what is happening in the industry and you would like an easy way to do so, I will take this opportunity to shout out one of my favorite podcasts. 

This is not sponsored, this is me just sharing what I like to benefit from. And that is The Wine News in Five. So the podcast is called The Wine News in Five. It is hosted by a woman named Samantha Cole Johnson. 

[00:18:00]

And it is actually driven out by the Jancis Robinson team. So Samantha Cole Johnson works for Jancisrobinson.com and every Saturday morning, I believe she publishes a five minute podcast episode. It is quite deep and technical, but she covers all of the top news stories of the week. And I do like to listen to it when I can, because it's a great way to get a quick snapshot of what's happening in the industry and to stay on top of it. 

I will tell you though, as I said, that it is quite a bit more technical and detailed than what we went through today. So depending on your level of interest and acumen, you may or may not find that interesting, but I wanted to share it nonetheless because I find that it's a great tool and resource.

And with that, I will bring this episode of The Wineitupanotch Podcast to a close. I hope you've enjoyed it. I want to thank you once again for spending your time with me. I always love when you do, and I hope that you will return for episode 40, which to me is a bit of a milestone, anniversary, big time celebration type of episode. 

I'm really proud to have made it to episode 40. And I hope that you will join me for that episode, soon upcoming. 

In the meantime. I wish you lots of peace, love light, and of course, good wine! And if you can spare the time to leave me a review on your podcast player, I would very much appreciate you doing so - it makes all the difference in the world. 

Thank you and take care. 

Cheers!