The country of Chile has an economy that is one of the most dynamic oriented in the world.  Chile is also home to some of the finest wineries in the world. Behind copper, it is the second largest industry in the country. 68% of its wine produced is exported and in 2009 alone, 670  million liters worth $1.36 billion.They have produced great quality wines at low, affordable prices for years. It is amazing in our different tastings how good they are for the cost.  

The earthquake that hit the country in February 2010, causing over 700 deaths, also resulted in more than $30 billion in infrastructure damage and their wine industry was hit hard. Wineries in the southern region of the country between the Colchagua and Maule Valley were the hardest hit. While buildings and some vineyards sustained minor damage, it was the barrels, tanks and bottles that were the most affected. The tanks ended up falling down onto each other or other barrels. Power outages, even lasting longer than a week, caused irrigation systems to shut down. One of the grim jokes making the rounds in the wine country is that on the day of the quake, rivers and canals ran red with spilled wine.

Wines of Chile, an industry trade group, estimates that 125 million liters of wine were lost or 12.5% for the industry. Many of these wineries estimate that it will take one to two years to repair everything as it was. The earthquake struck just before harvest was to begin. That is fortunate, because much more wine could have been destroyed.

 

Despite the disruption caused in the Chilean wine country, they say the quake shouldn't affect global wine prices, because Chile's market share isn't so large that a hiccup in its exports will cause scarcity.  Currently, they have simply cut discounting or giving incentives but how long can they hold off, in order to recoup some of their costs and losses? This will then affect the price of wines all over the world. The price competition wars will now favor on the side of the suppliers. Chile will start to raise their prices and other wineries will now feel they will be able to get more for their wines. That is how it goes. Any major catastrophe, although unfortunate, seems to always affect everyone by paying the price.  We will see.