Wednesday, 29 July 2009

Spare a thought for the CRAV


Of late, we have been quick to denounce any of form violent action. Although I agree with Orwell that dictatorships (and democracies for that matter) can stand peaceful protest until the cows come home, people can get hurt. Although in most cases nowadays (ref. G8), it’s the police that do the hurting.

So we are quick to condemn the CRAV, or protesting French winemakers, for acting with violence in reaction to what they see as unfair prices. They want better prices for their wines so as not to be driven out of business. Even in Bordeaux, we have little sympathy with the Bordeaux and Bordeaux Superieur producers who complain that barrel prices of €750 are barely enough for them to break even. They say they're not getting enough help.

It’s the law of the market, of the free market, we say, deal with it.

Read this (published today in New Zealand's National Business Review):

Some wine companies are exporting Marlborough sauvignon blanc in bulk to clear large wine stocks, the Ministry of Agriculture and Forestry says.

"Continuing down this path may affect the longterm future of the industry," said MAF economists.

"This risks damaging the value of the premium Marlborough sauvignon blanc brand," said MAF director-general Murray Sherwin.’


Essentially, New Zealand is telling its own producers not to go for lower prices, trying to shore up value against the market trend.

Now, the NZ government can say what it likes – it doesn’t change the overall economic picture – but you have to wonder if the French government would be so active in trying to help the industry. Would it step in to stop supermarkets trying to cut prices? I have to be honest here, and say it wouldn’t do toss.

So why do we accept the NZ government’s attempt to try to keep value in its wines, why do we accept that so much 1st growth wine is dumped into their second wines, why do we accept that most of the world’s diamonds are dumped at sea, and at the same time insist in the face of the CRAV that they must accept the vagaries of the financial market?

(Picture from the Associated Press)

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