Making A Grape Comeback Wine Is In Demand. That's Music To Napa Valley's Ears.

Posted: February 28, 1996

NAPA, Calif. — Vintners in the famed Napa Valley get giddy when they contemplate the growing cadre of customers like Suzanne Patmore.

The entertainment-industry executive used to spend no more than $10 for a bottle of wine. Yet there she was on a recent Friday night, clutching a wine magazine's list of recommendations as she strolled the aisles of a chic liquor shop in Los Angeles, scrutinizing labels on bottles marked $20 and up.

``I'm sort of branching out to decent stuff, to things that actually rate on the Wine Spectator scale,'' said Patmore, 28, as she stood in line at Wally's. ``I'm trying to start a wine cellar, and for the first time I'm buying wines costing $30.''

The good-wine craze is not just a California phenomenon. In Cherry Hill, N.J., wine manager Ernie Hebert of the Spirit Shop says customers who formerly spent $10 or $15 for a bottle of California wine are now willing to shell out $30 or $35.

``I am on the floor a lot advising customers . . . and they are looking for good California wines, especially red wines. . . . Has there been a jump in demand for reds!'' Hebert said.

The soaring desire for better California wines is making for heady times in Napa Valley and adjacent Sonoma County, the center of California's booming premium wine trade.

For shoppers, that means prices in many categories are ratcheting up, especially on rarer varieties like Merlot, an increasingly popular red wine.

After a difficult decade, much of it spent replanting vineyards in an effort to eradicate a ruinous pest, winery owners are reaping the benefits of improvements in quality and years of campaigning for more space on retail shelves and restaurant wine lists.

``It's an exuberant time,'' said John Skupny, vice president and general manager of Niebaum-Coppola Estate Winery in Rutherford, owned by director Francis Ford Coppola.

Thanks to growth in premium segments, particularly reds, the California table-wine industry in 1994 and 1995 enjoyed its best years since the mid-1980s - even though overall consumption of wine, particularly wine coolers, is declining in the United States.

The surge seems to be founded on a wave of favorable publicity touting the health benefits of moderate consumption of alcohol, particularly red wine.

The tide began to turn in 1991 when a 60 Minutes television segment spotlighted scientific theories linking moderate drinking of red wine to improved health in France.

Then in November the same television program reported on Danish studies showing a link between longer, healthier lives and moderate drinking. In the two weeks following, Americans scooped up 26 percent more red wine than in the same period the year before.

It isn't an unbounded windfall for the wine industry. Vintners' costs for grapes, barrels, bottles, corks and labels are also rising. And there is concern that unfettered price boosts could prompt hard-won customers to turn to cheaper wines from other states or from overseas. Meanwhile, dwindling supplies have forced some wineries to ration sales, a practice that upsets retailers.

Despite all that, the chief lament of most winery owners these days seems to be that they can't put their hands on enough quality juice to sate the public's increasing appetite. Nature gets much of the blame.

After last winter's torrential rains, vintners prayed for a warm, sunny spring and early summer. What they got were more downpours - and hail in June.

When Doug Shafer saw how many of the tender flowers on his vines had gotten ``shattered,'' he started scrambling. By early September, he was frantically offering growers $2,500 for a ton of merlot grapes, a crop that normally would have sold for $1,800. ``I kept telling them: `I'm not out of my mind. I need to have this,''' recalled Shafer, president of Shafer Vineyards, the Napa winery founded by his father in 1972.

Such scenes were replayed dozens of times in the flatlands and hillsides of Napa and Sonoma.

The good news was that a warm October made the crop come in beautifully. And a few years of lower production could strengthen vintners' hands.

Already, the greater desire for higher-priced wines in the last two years has had a salutary effect on winery bottom lines, which had suffered because of costly replantings to stem the spread of phylloxera, a bug that killed thousands of acres of vines by devouring their roots.

``It's common to see wineries with 25 percent increases in sales and 50 percent increases in profits,'' said Vic Motto, a principal with Motto, Kryla & Fisher, a wine country consulting firm in St. Helena, Calif. And the prospect of continuing price stability, or even higher prices, puts smiles on vintners' faces.

Until recently, California's wineries were doing battle on a number of fronts. In the early 1990s, they were faced with a vocal anti-alcohol movement, recession, higher taxes and health concerns.

Then, in 1991, a study by the Bureau of Alcohol, Tobacco and Firearms showed potentially dangerous levels of lead in some domestic and foreign wines. Wineries immediately set about finding alternatives for the lead foil wrappers that had been used on bottles to cover the corks.

A couple of years before, vintners and growers had begun noticing shriveled leaves on their vines, the early effects of phylloxera. They began a massive replanting effort that is still underway and is keeping many good vineyards out of production for several years.

Now, many wineries have been out of their most popular brands for several months and have been forced to allocate cases to ensure a steady supply to customers.

In November, Dennis Groth, owner of Groth Vineyards & Winery in Oakville, told distributors he had run out of Sauvignon Blanc and would be unable to fill any more retailer orders until May. The company is concentrating on maintaining its place on restaurant wine lists, even at the expense of losing shelf space in retail outlets.

``Everybody's running out of wine,'' Groth said. ``Retailers are finding you can't supply demand on an as-wanted basis.''

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