Its that time of year when we as a winery are out visiting our growers, taking a look at the vineyards to see how the current season has begun, and also reviewing the previous season - how the grapes were, things that could be improved from both sides and a look at the pricing structure.
With regards to pricing generally, it is amazing how random it all seems to be. Most people seem to plump for a figure somewhere near last years prices with a small increase factored in, with perhaps a premium added in cases where vineyards are perceived to have a high quality terroir or for grape varietals that are in high current demand. There seems to be very little knowledge of how those prices were first arrived at and little or no discussion about how they relate to the operating costs of a vineyard.
Most growers are paid by the tonne. Some also have an incremental scale based on ripeness or other such quality parameters. Another system not used often in NZ but which seems to approximate the current grape prices well is the 100 x bottle price formula. A few growers are involved in profit-sharing schemes with the wineries. Some wineries opt to lease the vineyard outright.
No doubt the Economists would tell us its all simple demand and supply - Pinot Noir often sells for twice the price of Riesling so growers shouldnt expect the same prices for their fruit despite the fact that all the good ones will spend exactly the same amount of time in the vineyard on both varietals.
Life isnt fair sometimes (if you grow/love Riesling!)
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