The Wine Guy, Eddie McDougall: Why wine prices vary

Our resident wine expert details why one wine can be so much more expensive than another
Illustration: Cat O’Neil
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Some wines can sting the wallet more than a fine dining experience at Amber, while others cost less than a Happy Meal at Maccas.

The most expensive bottle of wine I can recall being sold was an imperial (six litres) bottle of 1992 Screaming Eagle Cabernet from Napa Valley that was auctioned for a whopping US$500,000 back in 2000. The cheapest wine I ever bought was a bag-in-a-box during my university days that cost around $15 for three litres.

How come the price difference is so large?

More is less
It’s safe to say that the majority of wine is cheap plonk is made by large co-operatives that produce wine in bulk. In the USA around 95 percent of wine is pumped out by just five wineries. As per the laws of supply and demand, this sheer volume naturally ensures certain wines are significantly cheaper than others. I must declare, though, these cheap wines are not all bad. In fact, some excellent value stuff can be found for $150 in your local supermarkets.

Hand crafted
Large producers have more automated processes, whereas small shops work on the labour of love. There are now machines that prune, harvest, sort grapes, pump, plunge and press all grape matter, removing the many hands, horse and carts that used to do all the physical work in vineyards of old. However, when you do things by hand it means much more care and detail can be devoted to the process. It’s safe to assume that 99 percent of the world’s most expensive wines are hand crafted.

Oak
Barrels don’t come cheap – a single barrique (225l) can cost upwards of $20,000. So imagine you need to purchase 500 of them to make your wine. That’s one million dollars in nice wine storage. Oak isn’t the sole answer to making the greatest wines on earth but it does help contribute to those velvety tannins and baking spice aromas. Wines matured in barrels are also subject to the ‘angels’ share’, that natural evaporation of wine, which means there is less finished end product and a resultant cost that’s higher per litre.

Location, location, location
The vineyard game is just like a game of Monopoly where there’s cheap real estate and there’s unreachable. In wine, the vineyard location is critical as it provides the wine the single most unique factor once it’s finished and bottled. To put it into perspective, cabernet sauvignon from the Central Coast (where a lot of Californian bulk wine is grown) costs about $14,000 per tonne, where as cabernet sauvignon grown in Napa Valley averages at $55,000 per tonne.

Eddie McDougall

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