Why Wine Costs What It Does

Tuesday, August 21st, 2007 at 12:00 am

wine cellarIt might be a puzzle for others why different types of wines may have a great disparity in their prices. In many wine shops, one may be able to see a bottle of wine priced $4 sitting alongside another bottle that may be bought for a $50. There are certain factors that help determine the price of wine.

Location

One of the factors that affect the price of wine is its origin in terms of where it the grapes were cultivated, processed and made into wine. Centuries upon centuries of winemaking have enabled wine producers to know the best places of where to cultivate grapes. The best places tend to produce wines that may be priced higher than on lesser known locations.

There are also some top grape growing areas where grape production is only limited to a certain amount per acreage in order to maintain quality of the harvest.  Once wine makers reach that level of harvest in their area, their next option would be to grow their grapes in other areas or even buy the grapes from another grape grower.

Grape growing costs

Price of the wines may also be determined by the cost of growing the grapes in certain locations. Grape growing costs may cost higher in some areas like the Napa Valley area while it may not be as costly in others. There are also some wine makers who prefer buying their grapes from other sources which may cost a bit less, depending on the quality of the harvested grapes.

Winemaking methods

The methods used on how the different wines are made may also affect its pricing. Wine making methods used may also affect the quality of each wine bottle. There are certain producers that make use of traditional wine aging methods such as using French oak barrels that add to the character of the wine as it age.

There are other wine producers that may age wine in more sterile containers and simply add some wood chips to the wine as they age to add favoring. The different methods used may have some effect on the price of the wine as they reach the marketplace.

Demand

And lastly, demand for said wines can also greatly affect its pricing. Just like any other product, the law of supply and demand also works with wines. If the demand for wines greatly exceeds the supply that producers can cope up with, wine prices go up. If the supply far exceeds the demand for the wines, the prices go up.

These are factors that you should consider when you try to look up for quality wines out there. But bear also in mind that wine prices do not exactly determine the quality of wines. Expensive wines are not necessarily the best and vice versa. It is always up to you find out which ones will suit your own tastes.