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The Great Supply Chain Kerfuffle of 2021

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Delays in deliveries are affecting viticulture and winemaking procedures, product launches, and limiting consumers’ options during the peak of holiday wine-buying.

Jeff Siegel

Brian Talley ordered a new grape elevator in January, figuring that would allow plenty of time for him to use it this harvest.

He figured wrong. The elevator not only didn’t arrive on time—it showed up three weeks after harvest started. And it came disassembled and broken.

“That was pretty much a fiasco,” says Talley, whose 20,000-case Talley Vineyards in Arroyo Grande, Calif., specializes in Pinot Noir and Chardonnay. “The freight forwarder had all kinds of problems.”

Welcome to the Great Supply Chain Kerfuffle of 2021, which has made itself felt up and down and throughout the wine business. In Texas, some wineries aren’t sure they’ll have enough bottles for the 2021 vintage. A California broker got one shipment of Australian wine in the spring, but has no idea when the next will arrive. Wholesalers in a variety of states are scrambling to get product from producer to retailer—and sometimes coming up short. Some state ABCs are weeks behind in label approval. Even wine writers have been affected: One Texas reviewer was expecting a Chilean sample in July. It showed up at the end of October.

Perhaps the most telling? In Napa, a French barrel manufacturer expected a shipment in June. Now it’s supposed to arrive in November—maybe.

“When I kept telling them their barrels were going to be late, they were all angry and wanted to know if I actually knew what was going on and if the barrels were actually going to arrive,” says Françoise Gouges, who represents Burgundian barrel manufacturer Tonnellerie Sirugue in the U.S. “Now they’re sending me newspaper articles, saying, ‘We understand and we’re with you. We’re not mad at you anymore.’”

Everything from bottles to barrels and even foil is affected by the supply chain setbacks / Frank Wintermeyer / Pixabay
Everything from bottles to barrels and even foil is affected by supply chain setbacks / Frank Wintermeyer / Pixabay

Around the world

All of this supply chain havoc has its roots in the pandemic, say a variety of people in the wine and shipping businesses, who cite ships backed up in ports around the world and a shortage of the containers used to ship goods internationally.

But don’t think the problems are just on the other side of the world. Domestic producers can cite similar delays in getting their products to market, as well as difficulties in getting bottles, corks, and other closures, as well as labels, foil—and almost everything else used to make wine.

“The supply chain problems are everywhere,” says Michael De Loach, a broker and consultant in California. “Call it systemic—it has affected the wine business to more than a certain extent.”

And the supply chain problems are certainly not just about wine. One estimate by the Marine Traffic consultancy found 10 times as many ships waiting to unload in and around Los Angeles in October 2021 compared to October 2020. Depending on who is doing the estimating, the delays and shortages could last into next spring or as long as the beginning of 2023.

The reasons are many and varied: lockdowns that kept employees from working in various supply chain businesses; employee shortages, including ship crews, port and dock workers, and truck drivers; and pent-up demand with the easing of the pandemic. Industries as diverse as auto-making, toy manufacturing, and computer development have experienced shortages.

Wine has its own particular set of problems, starting with barrels, bottles, and the like, but also including the need for what are called reefers—refrigerated containers to ship wine. Containers are in short supply, and reefers are even more in demand. Wine not shipped in reefers can bake and go off, especially if it’s sitting on a dock in a non-refrigerated container waiting for a ship, truck, or rail car.

In this, there doesn’t seem to be any rhyme or reason why some imported wines arrive in a timely manner and some don’t, or why some domestic wines get to wholesalers and retailers and some don’t. An Austrian white, for example, was supposed to debut this summer; it still wasn’t widely available at retail at the end of October, thanks to delays in getting it across the Atlantic.

“We just don’t have any experience with anything like this,” says Gouges. “Typically, we know we’re going to get the barrels before harvest. Now, we just don’t know. It’s very worrisome for next year.”

Dozens of container ships have been waiting to unload their goods in American ports / Alexander Kliem / Pixabay
According to the Marine Traffic consultancy, several container ships are waiting to unload in American ports / Alexander Kliem / Pixabay

Down the line

Where does that leave the wine business heading into the holiday season? The consensus—from talking to producers, importers, wholesalers, retailers, marketers, and consultants—revolves around these four things (with the caveat that since this has never really happened before, nothing is certain):

  • There may be shortages of some products—Champagne, for example, which has been hard hit by shipping delays and is especially seasonal; but the shortages may not extend across the country. Some markets may already have most all of what they expected to have. Some, have very little.
  • Regardless of what’s in short supply, retail shelves won’t be bare. There’s enough wine in the supply chain—in warehouses, including previous vintages—to fill out retail displays. But there also might not necessarily be what consumers or retailers were counting on.
  • Wineries may have to delay label and packaging changes for a season or two. Talley was planning to change the capsule style on a wine focused on for DtC. When the new capsules didn’t arrive on time, he had to bottle the wine without capsules and postpone the changes until the capsules do arrive. “The good thing is that, since it’s DtC, we can explain why the wine didn’t have them,” he says.
  • Delays in some new product launches. De Loach, the broker who had trouble getting the previously mentioned Aussie wine into the country has also had additional difficulty getting COLA approval in several of the states the wine was supposed to launch. Hence, even when wine arrives, there’s no guarantee that it will be able to be sold in the states where it’s supposed to be sold, given label approval delays.

The best advice comes from Gouges’ clients. At the end of the day, the wine industry and wine consumers need to understand the supply chain woes are bigger than any one person or company. And hope for the best.

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Jeff Siegel is an award-winning wine writer, as well as the co-founder and former president of Drink Local Wine, the first locavore wine movement. He has taught wine, beer, spirits, and beverage management at El Centro College and the Cordon Bleu in Dallas. He has written seven books, including “The Wine Curmudgeon’s Guide to Cheap Wine.”

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