Comments on: Cork economics

Question: Cork economics

machaus — Sun, 09 Dec 2007 08:53:13 -0800

I keep hearing that synthetic wine corks are endangering the livelihood cork farmers. Why hasn't the upswing in the use of cork flooring offset this phenomenon?

By: burnmp3s

burnmp3s — Sun, 09 Dec 2007 09:14:46 -0800

The short answer is that wine corks still represent the greatest demand for cork, so cork flooring and other uses still have a long way to go before they consume as much cork as current demand for wine corks.

According to a cork importer, wine corks represent $1.1 billion in raw cork sales, whereas all other uses combined only represent $400 million. So if wine cork demand was cut in half, all other uses would need to more than double to make up the difference.

By: Steven C. Den Beste

Steven C. Den Beste — Sun, 09 Dec 2007 09:42:39 -0800

The issue is money, of course, not physical volume. Cork flooring is a composite made of shredded cork, while wine corks are large solid pieces. Cork flooring may well represent a larger mass of cork, but they can't charge as much per kilo for it as they do for wine corks.

The market for cork flooring won't sustain the kind of price-per-kilo that wine bottlers are used to paying.

By: ssg

ssg — Sun, 09 Dec 2007 10:08:53 -0800

According to this article, cork flooring is made from the waste left over after making more valuable things (including wine corks). Cork flooring is also made from lower quality (i.e. cheaper) cork than wine corks.

By: ssg

ssg — Sun, 09 Dec 2007 10:21:51 -0800

Also, I'm not sure if your premise is correct. According to this article (from 2002), the world market for wine corks is growing at 7% per year, so presumably cork farmers aren't doing too badly. Given that it takes 25 years for new cork trees to mature enough to have their bark harvested, I doubt supply is keeping pace with demand.

By: Steven C. Den Beste

Steven C. Den Beste — Sun, 09 Dec 2007 13:21:56 -0800

Harvesting a cork tree doesn't kill it. It takes 25 years for a cork tree (a kind of oak) to get big enough to be harvested, but then it can be harvested every nine years, and the trees can live for hundreds of years.

By: Malor

Malor — Sun, 09 Dec 2007 13:23:42 -0800

It's been my understanding that there has been a tremendous cork shortage for a long time, and that wineries were being forced to go to artificial corks due to cost.

If cork manufacturers are going out of business, it's probably because they don't have enough cork, not because they don't have enough demand.

By: mek

mek — Sun, 09 Dec 2007 15:02:30 -0800

This sounds like some bullshit theory hipsters proposed so they can reject synthetic corks. I suppose cork farming triggers an outpouring of love because it's a sort of industrial incarnation of hug-a-tree. Here's a few lovey-dovey articles about how the peaceful and harmonious ancient art of cork farming is being threatened by evil plastic. I'll warn you that they're not heavy on facts.

The cork forests can only produce so much, and demand would way outstrip that production if it weren't for cork alternatives. If anything, alternatives have enabled the cork industry to remain sustainable and environmentally-friendly. As far as the "livelihood of cork farmers being threatened," I can't find any evidence from the industry itself that demand has even tapered off significantly.

Oh, and here's a good comment on cork vs. alternatives.

By: paulfreeman

paulfreeman — Mon, 10 Dec 2007 05:14:37 -0800

There was (And maybe still is) a shortage of cork, which forced wine producers to shift to alternatives both with plastic corks, or screw caps such as stelvin.

Because wines behave differently over time when bottled with different tops, the initial uptake of alternatives was pretty slow historically, but the shortage of cork forced their hand slightly, and now wine produces as a whole are much happier to use other methods now they have some experience over time with them, depending on the region. So as was mentioned above while in 2002 the demand for cork might have been up, this year from conversations I've had with various wine suppliers and agents there is a massive uptake in various forms of alternatives to cork. (The Zork been my favourite)

Since a shortage of cork would effect the cork farmers no matter what the end product I would imagine the difficulties they face are more wine spread then the final usage of their produces.