Grapevine: Beware the Russian Bear as it Flexes its Diminishing Might
There are many facets of wine, primarily self-contained within the expansive wine industry. From the agricultural component, to the technological, biological and marketing components, the wine industry, at least in the United States, tends not to cross the line into sociopolitical matters or governmental intervention and influence–not to any major extent (federal distribution regulations notwithstanding). However, this is not always the case in other wine-producing nations.
Social trends and political intervention are exerting increasing influence in certain countries. For example, in Russia, the demise of the Soviet state and the recent international sanctions over the annexation of Crimea have altered Russian drinking trends and consumption. These changes in Russia have affected the fortunes of the neighboring wine regions that flourished during Communism. The reign of Vladimir Putin has also introduced new tensions in the area’s wine industries.
As I’ve been following the domestic and international political state of affairs in Russia, I’m noticing a number of political influences on wine sales. Here, from the perspective of Russian wine consumers, are recent developments in the Russian wine market.
Good news: Wines from Georgia, highly popular in Russia before and after Georgian independence, were banned in 2008 as the result of a war with Russia. Last year, trade relations resumed and Georgian red and white wines from the Black Sea area are once again available and increasing in popularity.
Bad news: Wine exports from Moldova to Russia flourished during the post-Soviet era, accounting for 90 percent of production of these highly regarded wines. Then in 2006, Russia banned all Moldovan wine imports. Trade resumed a few years later, but last year a new ban was imposed. Moldovan winemakers began exporting their wines to Western Europe; a few trickle to the United States. I attended a Wines of Moldova event this summer and enjoyed several excellent wines.
Bad news: Sanctions and embargoes by Western nations. Begun soon after the Crimean annexation, wine imports were not widely affected by these measures. However, anticipating an ever-growing list of goods banned by the West, President Putin’s office recently purchased over one million bottles of wines from the European Union. At least the politicos will be able to weather the Western measures for a while.
More bad news: The dramatic drop in oil prices, coupled with the devaluation of the ruble. Those imports still crossing the Russian borders are becoming more expensive by the day. Russians enjoy French and Italian wines. Escalating prices will certainly affect the purchasing power of middle class Russians.
Even the wealthy oligarchs are affected. Government-created Russian oil billionaires are increasingly subject to personal and corporate sanctions; purchasing fine French and Italian wines is increasingly difficult. Although the fortunes of a number of these oligarchs can be tenuous in today’s political climate: enjoying fine wine with President Putin in St. Petersburg’s top restaurants one day, drinking tap water with fellow exiles in a Siberian cafeteria the next.
Good news: Wine consumption has been increasing steadily – albeit rather slowly. However, one reason for the increase in wine consumption is encouragement from Moscow. Alcoholism is rampant in Russia; to discourage vodka consumption, the government has embarked on a campaign to encourage citizens to drink wine. Steering citizens from 80 proof spirits to 14 percent alcohol would be considered a triumph in reducing alcoholism. We’ll have to wait and see if this campaign proves effective.
Bad news: Retaliation to the sanctions. The Russian parliament is considering a ban on all French wines. Ironically, this could be devastating to Russian consumers, who favor French wines; nearly 20 percent of Russia’s worldwide wine imports are from France. At least consumers wouldn’t need to be concerned about the rising cost of these wines.
Is the Sleeping Bear of post-World War II now a Bear gone wild intent on flexing its muscles in a world torn by turmoil? Perhaps, but at least the threat of Bear-drunkenness is not rampant, not with wine consumption in check.
Nick Antonaccio is a 35-year Pleasantville resident. For over 15 years he has conducted wine tastings and lectures. He also offers personalized wine tastings and wine travel services. Nick’s credo: continuous experimenting results in instinctive behavior. You can reach him at nantonaccio@theexaminernews.com or on Twitter @sharingwine.
