Historic trucker shortages, port logjams and labor strikes are just some of the elements that are bringing the wine industry to its knees this year. Supplies are down, and prices are up, across the board. Writing in The Wine Industry Advisor, Kathleen Willcox reports that: “Turning the page on 2020, the wine industry was optimistic about the year ahead. But sunny predictions were eclipsed and chaos—caused by weather challenges and supply chain disruptions — reigned. Now that we have entered 2022, the following issues from 2021 are predicted to recur:
Glass & Labels: Kathleen Inman, owner and winemaker at Inman Family in Santa Rosa, says “glass prices have increased, as have shipping costs and even the costs of printing labels.” Currently, Inman says, it costs more to ship bottles than the base cost of glass itself, and “labels have almost doubled in price.” The price increases for raw materials mean the 2021 vintage will cost $14.95 more per case to produce.
Barrels & Capsules: Bobby Richards, winemaker at Seven Hills Winery in Walla Walla, says driver shortages meant a delay in his barrel delivery. “It’s a perfect storm of delays,” Richards says. “It seems as though everyone is expecting to receive their orders in early versus late spring or early summer, causing many people to over-purchase because they think our suppliers will run out.”
Cardboard & Cans: Ryan Ayotte, CEO and founder of Ohza, a canned mimosa, says that “everything from the cans, to the cardboard to shipping has increased and is harder to come by. Extreme cardboard delays recently went from six to 15 weeks, and it has forced us to change how we forecast sales and find better finance options.”
Labor & Shipping: Hans Herzog Estate in Marlborough, which produces 2,500 cases of organic wine, has overcome several problems—including a 40 percent lower harvest. But their biggest challenge was labor, says co-owner Therese Herzog. “With closed borders there are just not enough laborers in New Zealand,” Herzog says.
Tom Steffanci, President of Deutsch Family Wine & Spirits, which has 24 brands producing 12.9 million cases under its umbrella, agrees that “labor shortages at warehouses, production facilities, and transportation companies” led to “extended fulfillment times and a reduction of service.”
Willcox concludes that “Rethinking the supply chain on the fly isn’t easy, but these producers prove that a steady supply of creativity and flexibility pays off in customer loyalty now, and hopefully into the future.”
Here at Skolnik Industries, our customers are very loyal to our stainless-steel wine barrels. Note that our stainless-steel wine barrels are durable, reusable, easy to clean, and recyclable at the end of their service life. Check out the full line of our Stainless Steel Wine Drums here.