Some Bev/Al Stocks Recover a Bit, But Most Top Names Don’t

The stock market closed Tuesday down about 0.5% as measured by the Dow Jones Industrial Average of 30 blue-chip stocks.  But unlike Monday’s blood-bath, eight of the 17 stocks we follow gained ground.  Among those gaining ground, Constellation Brands (up 0.64%) and Molson Coors Beverages (up 1.44%).   But some major, blue-chip bev/al stocks eased again, including Pernod Ricard (-3.02%), Bown-Forman (down 1.44%), Anheuser-Busch InBev (down 1.1%), Diageo (down 2.34%), and Moet-Hennessy Louis Vuitton (down 1.58%).

There didn’t seem to be any particular reason for some of the quality bev/al stocks continuing to fall while some of the more volatile stocks, such as Willamette Valley Vineyards, Vintage Wine Estates and Boston Beer posted losses.

The S&P 500 closed in bear market territory for the first time since 2020, ending 0.4% lowere.We suspect stocks, including bev/al stocks, will continue to be unsteady for a while, especially since the Federal Reserve is expected to announce interest rate hikes on Wednesday.  The only question there seems to be how big the rate hike will be.

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Who & What —

Constellation Brands names Joseph Suarez the new head of investor relations, succeeding Patty Yahn-Urlaub, who is retiring.

Southern Glazer’s Wine & Spirits appoints Chris Williams executive vp-national accounts.  He succeeds Shawn Thurman, who will be retiring as EVP-national accounts in December.  Williams joins from Anheuser-Busch InBev where he was chief commercial officer-ventures.

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TTB Proposes Removing Ban Against Saying Wine Contains Distilled Spirits

Among wine labeling practices Alcohol & Tobacco Tax & Trade Bureau considers deceptive is labeling wines to indicate they contain distilled spirits.  It also considers advertisements making such a statement to be deceptive.

Now, TTB is proposing eliminating the advertising and labeling provisions which date to the 1930s after Repeal of Prohibition.  They were originally adopted likely as a measure to prevent winemakers from misrepresenting to consumers that their wine contained or was comparable to distilled spirits, TTB said. In the one exception to this prohibition, if a statement of composition is required to appear as the designation of a product not defined in part 4, the statement of composition may include a reference to the type of distilled spirits that has been added to the wine.

Sweet & Fortified Wine Association, a wine industry trade group, submitted a petition to TTB requesting that the regulations be revised to allow dessert grape wines to be labeled with the words “fortified” and/or “grape (wine) spirits added.” These industry members produce wines that are typically standard grape wines in the style of port, sherry, madeira, or other types of dessert wine which contain added brandy or other distilled spirits. However, current regulations prohibits statements on standard wines ( i.e. wines which meet a class and type designation) which indicate that the wine contains distilled spirits.

The association argues that the prohibition on use of “fortified’ when it comes to wine is archaic, and after review, TTB says it agrees. Under the proposed regulation, wines that do meet a standard of identity could also be labeled with truthful references to added distilled spirits. Thus, for example, a product that meets the standard of identity for grape dessert wine in § 4.21(a) may be labeled with a statement of composition such as “Grape wine with added brandy.” The proposed regulations would apply to any wine that contains added distilled spirits, and not just to dessert grape wines as proposed by the petitioner.  The proposed regulation would also allow the use of “fortified’ as part of a statement of composition, such as “Grape wine fortified with brandy.”

The proposed regulation also would prohibit only statements that would be false or misleading, such as a statement that the wine contained distilled spirits when it did not.

Comment are due by August 12, 2022.

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Budvar Says Exports Rose a Record 11% in 2021

Budejovicky Budvar NP, a 126-year-old state-owned brewery in Prague, Czech Republic, said its exports reached 34.3 million gallons.  All its major markets — including Britain, Slovakia and Germany, contributed to the increased sales.  Sales in Germany reached 13.2 million gallons for the first time.  Budvar has been in a long legal dispute with Anheuser-Busch over use of Budweiser as a brand.

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Realm Cellars Acquires Two Properties

Realm Cellars, Napa Valley, purchased Houyi Vineyard and Nine Suns Winery in Pritchard Hill.  Terms weren’t disclosed.

The purchase culminates an amazing turnaround for Realm, which faced bankruptcy in 2011.  Today the winery owns vineyards in three of Napa Valley’s most prized subregions for Cabernet Sauvignon production — Stags Leap, Coombsville and Pritchard Hill.

The sale included Nine Suns winery, which has 7,000 square feet of caves and can produce 8,000 cases a year, the Nine Suns and Houyi Vineyard brands, and Nine Suns inventory.

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Reyes Closes Columbia Distributing Acquisition

Reyes Beer Division (RBD) has officially closed on its acquisition of the Northern California business from Columbia Distributing in Sonoma and Marin counties. The new operations will now do business as Golden Brands.

The acquisition adds around 1,350 customers, about 4 million cases, and includes brands from key suppliers such as Constellation, Molson Coors, Lagunitas, Mark Anthony Brands, Sierra Nevada, Boston Beer, Heineken and Diageo, along with a craft beer portfolio.

“We look forward to officially welcoming our newest employees and customers to the Reyes Beer Division family,” said Tom Day, Chief Executive Officer for Reyes Beer Division. “We’re in the business of putting people first, which we believe fuels our success. By empowering and relying on the institutional knowledge of the expert local leaders and trusted frontline employees, we’re able to continue delivering our company’s purpose of connecting customers, consumers and brands every day, everywhere we operate.”

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