The Price of Wine

One of the most common questions about a bottle of wine, especially those in the $20.00+/bottle category, is why that price? Why is this Shiraz from Australia only $12/bottle, but this Shiraz from Australia is $50/bottle. It’s the same grape, from the same region so what gives?

There a number of factors that goes into the final price of a bottle of wine. Whether the bottle is produced domestically, or it is imported as well as what liquor board it is being brought through all play a role in the final price. But I want to look at the pricing for a bottle you purchase at the winery.

The Vine – The age of vine plays a major role in wine. When a vine is younger it will produce more fruit, and this fruit will not be overly concentrated. As the vine ages it produces fewer grape clusters, but these clusters are much more concentrated as all of the nutrients in the vine are going to only a handful of grapes. The cost of maintaining a vine will be essentially the same whether it is young or old. Result – Wines produced from older vines will usually cost more than those produced from younger vines, and will often be much more concentrated and complex.

Vintage/Weather – Temperature and precipitation impact different grape varietals in different ways – some positive, some negatively. In a general sense a hot dry vintage, will produce less fruit to be harvested but it will often be of a higher quality compared to a wet a cool vintage that produces more fruit on the vines but a less concentrated, lower quality fruit. Please keep in mind this is a very broad generalization. The cost of wine from low yielding, highly concentrated vintages will often be greater than those from a high yielding, low concentrated vintages. Please note this is a very broad generalization, and does not apply to all regions or grape varietals.

Picking and Sorting – Handpicking grapes is much more time-consuming and costly than machine harvesting. Hand sorting the grapes is more costly and time-consuming than machine sorting.

Oak or Steel – Wine that is fermented and/or aged in oak barrels is more costly than aging and/or fermenting in stainless steel tanks. The primary reason for this is simply a matter of quantity that can be put into each vessel. A single steel tank can hold 30,000 litres or more sometimes. While a standard oak barrel will hold an average of only 225 litres. Wines that spend time in oak barrels will often cost more than those that only see stainless steel.

Aging – The amount of time a wine has spent in both barrel and bottle will also impact price. If a wine has been aged in oak for 2 years, it is going to demand a higher price point than a wine that has spent 6 months in the barrel. The same can be said for time a wine is aged in the bottle in a winery’s cellar.

Of course, there are many more factors that go into the price of a bottle of wine and every individual wine price will be determined by unique influences. So next time you find yourself wondering about the price of a bottle, keep some of these factors in mind.

Have I missed any obvious factors in pricing? What are your thoughts on the prices of wine you buy?