Symington: Cheap Douro wine is doing serious damage

Cheap Douro wine sold at discount retailers in the UK is doing “serious damage” to the industry, according to Paul Symington of Symington Family Estates.

Speaking to db after being presented with a Lifetime Achievement Award by The Drinks Business and the Institute of Masters of Wine at Vinexpo, Symington said: “Port volume sales are in decline, which is having a big structural impact on the region, as it hasn’t properly adapted to the new commercial reality yet.

“The fundamental issue is about Port grape prices, which are high, while Douro wine grape prices are sold as a by-product at two thirds less than the cost of growing them, which is a suicide mission.

Paul Symington wants to raise the status of Douro reds

“Our yields are 80% lower than in Chile and yet you can find Douro wines on the shelves at Aldi for £5.99, which is utter madness and is doing serious damage to the industry. We mustn’t devalue our region by selling our wine too cheaply.

“These extraordinarily beautiful wines should not be sold at these price points. I’m worried about the economical impact this will have on farmers and am concerned that the way things are done at the moment will damage the region’s future potential.

“There have to be changes to the way things are run in the Douro but there has been a blinding silence from the government so far. For some, there is a vested interest in maintaining the status quo, which is unbelievably short-sighted.”

Symington admitted that dry Douro wines hadn’t thus far been as successful in the UK as he thought they would be.

“I don’t think the answer is being less regulated but regulated in a more effective way. The laws need to be adapted for the 21st century rather than the 1920s.

“My big dream is that Douro wines reach the level of the Super Tuscans in terms of acclaim and recognition. In terms of quality, this is perfectly do-able, but we are tripping ourselves up at the moment, which is deeply frustrating.

“These are astonishing wines that are worthy of being considered in the same bracket as Sassicaia. I’d love to see some of the top Douro reds reaching cult status and trading on Liv-ex.

“The wines have come a long way since the early 2000s – there used to be too much wood and extraction, but we’ve learnt a lot over the last 20 years and we have the authenticity and quality for a few of the top wines to reach cult status,” he said.

8 Responses to “Symington: Cheap Douro wine is doing serious damage”

  1. Nick Oakley says:

    There is no Douro wine on sale at ALDI at any price. There will be a Christmas offer reserve red at a (much) higher price. There is a Douro wine at LIDL called Azinhaga do Douro – it’s reserve wine at £5.99

  2. L3 says:

    ““There have to be changes to the way things are run in the Douro but there has been a blinding silence from the government so far.”

    What did he expect? The government is not a port producer.

    Or was he expecting acreage quotas, price controls, or similar. n other words this is just another anti-consumer call for protectionism.

  3. Allen Murphey says:

    I applaud the effort to cast the dry wines of Portugal as being great, which some are definitely worthy. However, in every wine growing region in the world that has achieved a high level of sustained quality has to deal with cheaper knock-offs within their appellations. The notion of non-fortified dry red wines from Portugal is a fairly novel concept to today’s consumer. Isn’t the path to recognition tied to consumers buying the wines? At $15 a bottle the risk of trying something new can be justified, at $30+ a bottle, not so much.

  4. Charles Crawfurd says:

    These ‘mad’ prices though reflect the realities of the market. If demand was higher or volume lower things would change. It takes years to get a vineyard into production and to rip it up not only costs money but is a drastic response whih could backfire if Port volumes take a turn for the better.
    Furthermore what else would these farmers grow?
    Paul can bemoan these prices but that is the harsh reality. As for dreams of super Tuscan status (and presumably price) does that mean he sees the Douro as only being in the realms of those with very deep pockets? I hope not.
    The counter argument surely is consumers will get to experiment and taste ‘cheap’ Douro wines and find them wonderful and be willing to trade up progressively to better quality from the same ‘unknown’ region. Bordeaux after all offers wines at prices from a few euros to hundreds of euros per bottle. Why not the Douro?
    It won’t happen overnight but that surely is the right way forward. It is not Aldi’s ‘fault’ they are currently so cheap!

  5. This is a complicated issue and commenters should have all the facts before passing judgment.

    The quantity of port grapes that can be produced in the Douro each year is regulated by the Port Wine Institute, which reports to the Portuguese Ministry of Agriculture. This system was introduced in 1933 and is similar to what exists in Champagne. The annual quota (called the ‘benefício’) is based on an assessment of quality and future Port sales and stock requirements.

    The Douro is a region of roughly 21,000 farmers. 92% of them have fewer than 5 hectares of vineyard. Each year every farmer is provided with a license for the amount of their grapes that they are allowed to sell (or produce themselves) as Port grapes. In a region where the economy is highly dependent on vines, the income farmers receive from their Port grapes (between €1.40 and €1.20 per kg) is absolutely crucial and our region would see widespread vineyard abandonment and economic harm without it.

    In the past, there was no commercial market for the grapes that didn’t have a license for Port production, so these ‘excess’ grapes were broadly just used to produce wine for local production (called ‘consumo’). The past two decades have seen the rise of an exciting new generation of Douro wines which have received widespread critical acclaim. This is fantastic news for the region and the farmers and is a credit to the producers and winemakers.

    However, as a result of the fixed market for port grapes and over-production in the region, most Douro DOC wine grapes are being sold (by farmers to wine producers) at between €0.25 and €0.40 per kg, which is well below the average cost of production of between €0.70 and €0.90 per kg. (NB: In a couple of recent low-yielding years the price received for Douro DOC grapes has been slightly higher and there is some variation within the sub-regions, but these figures are accurate estimates for the average prices across the region over the past decade).

    In other words, 63% of the region’s grapes are currently responsible for 87% of farmer income, and the remaining 37% are delivering only 13% (figures based on the 2016 harvest). This means that the farmers are losing out economically and the dynamic new Douro DOC business is being built on false cost foundations.

    The global Port market has been declining in standard quality volumes in recent years but it has thankfully been increasing in premium volumes and overall value, due largely to the hard work of the port producers and their customers in the wine trade around the world… innovating in both products and packaging, constantly working to improve quality, and investing in communications, education and training.

    Nevertheless, as a result of the decline in standard Port volumes, the quota that individual farmers receive for their Port grapes has been shrinking (along with their income levels) and there is even more over-production in the region.

    The tragedy is that a generation of wine drinkers are being trained to think that Douro wines are cheap wines – on a level with mass-produced wines from other highly-mechanised regions – when in fact we have amongst the lowest yields and the highest grape costs per hectare in the world (the Douro is the world’s largest area of mountain vineyard, mechanisation is very hard and much work is still done by hand – therefore expensive).

    We cannot have a regulated market in the same region as a free market, due to the distortion that the former is having on the latter. The changes that are required will not benefit our family business, we are raising them due to our concern about the impact that the current situation is having on Douro farmers and negative outcome it will have on the Douro DOC business when the real costs of production are reflected in the prices on the shelf.

    We are proactively engaging with the relevant authorities and have contributed extensively to a strategic review of the port trade. We will continue to draw attention to this unsustainable and unfair situation, to achieve sensible reform that benefits all those who earn their living from our beautiful wine region.

  6. The “beneficio” issue has been for a long time mentioned by more than one producer as a concern for the Port wine industry. Perhaps it is the time to have a serious industry discussion about it as well as on the kind of Port wines the sector wants to make the backbone of the industry. Very entry level Ports or more premium wines that reflect much better the grandeur of Port? I also understand there is now also concern with the government’s decision to re-establish the Casa do Douro and the obligation for grapegrowers to join it. Perhaps Paul can give us extra insight on this issue too.

  7. Peter May says:

    Agreed, Paul, entirely.
    But there is surely a temporary advantage of these low price point wines in that it will encourage many more people to try them – and I considered the Aldi version actually pretty good!
    To gain increased prices you’re going to have to go down the limited appellation/segmentation route, I suggest – as every other area does – and as you’ve really been doing for port.
    Best wishes from someone who you were kind enough to invite to the Douro a very long, if memorable, time ago….

  8. Gary Baldwin says:

    A couple of years ago i was invited to judge in the Portuguese Show in Lisboa and as part of that trip I spent a few days in the Douro Valley seeking out the red table wines.
    Two lasting impressions were made on that trip, firstly the impressive quality of Portuguese table wines in general and the amazing potential of the Douro blended reds blended from ancient port vineyards.
    But perhaps was most astounded by the low prices of theses wines.
    I am with Paul in that the Duoro Valley can in time become a great red table wine region but the growers must ultimately be rewarded or the industry will collapse.
    Portugal and its wine industry needs to stand up and market these wines to the world; that takes commitment and it means money must be spent but it will pay handsome dividends in the long term.
    The industry and government must invest.

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