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Tuesday, April 21, 2009
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Value and Domestic Wines Lead Sales in February
Domestic and value wines continued to grow in the four week period from April to March, compared to the same period last year, according to Nielsen data. Domestic wines grew 6.7% to over $450m, a 4.6% increase totaling almost 7m cases. While import wines grew 3% to just under $185m, they lost 0.7 market share points in volume. Certain regions were able to resist the trend. Argentina has led the charge for imported wine, growing an impressive 52% in dollar value in February to about $11m. New Zealand and Chile also continued with double digit growth, but trailed far behind Argentina. Nielsen also revealed that retail sales of wine grew in 2008, up nearly 1.2 million cases with a dollar sales increase of 4.7%. The top varietals by market share in U.S. food store volume were: Chardonnay, Cabernet Sauvignon, Merlot, and White Zinfandel, accounting for over half of the sales. Other notable gains were Pinot Noir (up 16%), Riesling (up 10%) and Pinot Grigio (up 6%).
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Criticism against California’s 'Dime a Drink' Tax
After lobbying by the Wine Institute and other trade organizations, California’s proposed nickel-a-drink tax was defeated. It seems, however, that the idea of taxation per drink has not left the minds of many of the state’s policy makers. Assemblyman Jim Beall Jr., has introduced a bill that would raise alcohol taxes by a dime a drink, raising an estimated $1.2 billion a year. In a press release, Mr. Beall explained his reasoning for the tax: "The alcohol industry creates devastating problems - traffic accidents, alcoholism - and walks away with money stuffed in its pockets while the public - including nondrinkers - are left to pay billions for the mess." One individual, Edward Stringham, has been drawing increasing attention to the new legislation arguing that the assemblyman’s claim that the beverage alcohol industry creates problems “is false” according to his own research. In an article published in the OC Register, Strinhham, a professor heading the Reason Foundation, argues against the claim that that drinking reduces productivity. A 2006 study by the Reason Foundation found that “drinkers earn 10 percent to 14 percent more money than nondrinkers. Men who drink socially, visiting a bar at least once a month, bring home an additional 7 percent in pay.” Stringham also argues against the idea that alcohol increases crime rates. “The explicit assumption in blaming these crimes on alcohol is that the offenses would not have occurred without it. There is no proof of that.” He concludes his article by claiming that "the overwhelming majority of people who consume alcohol do so responsibly." Heavy drinkers are not affected by higher prices; instead it is light- to moderate drinkers who will be affected. "If alcohol abusers are truly addicted, will an extra 'dime a drink' stop them? Will a career criminal decide to not get drunk before his next crime spree because of a 10-cent-per-drink tax? Of course not."
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New Technology Successfully Freezes Alcohol, Opening New Markets
Glazierepura is a new patented technology that allows for the freezing of alcohol and alcoholic beverages. Developed by AEGS Ventures, a U.S./Israeli corporation, and the University of Minnesota, the Glazierepura natural freezing process can freeze any alcohol and does not affect the flavor profile of the spirit. “The possibilities are endless,” explains Tom Wilen, senior advisor for AEGS Ventures, “Imagine placing a few vodka ice cubes in orange juice, you have the perfect screwdriver, enjoying a truly frozen margarita at a BBQ, or taking a Johnnie Walker on the rocks where the ice cubes are the scotch itself; there are so many variations.”
AEGS Ventures has been developing formulas for all of the leading brands in its laboratory in Israel, and has been ramping up production capacity to meet the needs of any beverage alcohol group who adopts the process. Wilen along with other senior advisor, Marc Horowitz, see the frozen technology as a unique promotional tool for a brand or a means to creating a whole new generation of line extensions. Glazierepura will have its official launch April 27th at STK in New York City. AEGS Ventures has partnered with Leblon Cachaça for the launch, developing frozen cachaça and Caipirinha ice pops to offer the market their first taste of frozen alcohol. The launch will be led by recognized chef Sam Hazen, welcoming mixologists, top chefs and industry insiders. Hazen says "I am thrilled to be involved in a new and exciting venture with Glazierepura. They are taking the concept of pairing high-end spirits like Leblon and creating unique ways to enjoy them."
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