What Happens When Every Wine Region Wants to Be Premium?

A friend recently told me about a wine dinner he attended devoted to Montepulciano d’Abruzzo, a region in East Central Italy in the foothills of the Apennines. My first reaction was mild surprise. This is a region known for affordable table wines. Of course, there are more ambitious examples, especially from Colline Teramane DOCG. Still, a formal dinner built around Montepulciano d’Abruzzo seemed an unusual idea. Then he mentioned the prices. Several bottles were approaching what most consumers would regard as premium territory in the $40 range. The formula for at least some premiumization is familiar. Reduce yields. Let the grapes get riper. Extract more color and tannin. Age the wine in oak for one to three years and add $20 or more (sometimes much more) to the price. I’ve tasted some decent examples from this region some years ago. But what happens when every wine region decides its future lies upmarket? Premiumization has become the wine industry’s standard answer to weak demand.…