Staff Reporter

Greenblatt's Deli on Sunset Boulevard recently ran a newspaper ad warning that "The Real Y2K Problem is: Champagne Shortage Threatens the World."

At Wally's in Westwood, the sale of champagne is up 22 percent over last year. And if a liquor store wants a case of the entertainment-industry's favorite bubbly, Cristal, fahgettaboudit.

"All of our grand marquee champagnes are virtually spoken for through the end of the year," said Jim Myerson, president of Wine Warehouse, a Los Angeles-based distributor that has the exclusive rights to Cristal.

It's all part of millennium madness, the urge to celebrate the next century with a tingling bottle of chilled champagne. L.A.'s champagne sippers have already begun hoarding top brands like Cristal and Dom Perignon, which now sell for more than $100 a bottle, but which are expected to fetch considerably more as Jan. 1, 2000 approaches.

"People are stocking up, and certain brands and items are in short supply," said Jeff Kavin, the manager of Greenblatt's. "I have one or two bottles of Cristal left in the store and I won't get any more for weeks. Most of the high-end brands are hot."

In addition, Kavin said prices for the top vintages, like 1990, are soaring. One champagne maker just hiked its top bottle from $100 to $150.

Usually, dealers like Greenblatt's are warned of an impending price hike. Not now.

"It's supply and demand," Kavin said.

At the Wine House in West Los Angeles, champagne sales are up 20 percent, and because the store is running low on what are called the "grand marquee" brands, shoppers are trying second-level labels and California sparkling wines.

"Cristal and Dom are difficult to get at this time, and when we do, it goes out just as fast," said Jamie Giannioses, the Wine House's sales manager. "What I am seeing now is consumers tasting through, buying brands they never tasted before."

Barry Ryan, manager of Wally's, said that as New Year's approaches, the demand for champagne, especially for the top brands, should increase dramatically.

"Like all quality, there is only so much," he said. "You can't run out and brew up another batch. People are being made aware of that and they better start looking early."

Of course, that kind of talk might be more a reflection of wishful thinking than reality. In fact, retailers and champagne makers have been making no secret of the champagne crunch. Moet & Chandon, for example, has been running ads urging people to "Prepare."

Such hype isn't always good for retailers. Some even complain that wine makers are using the scare to artificially inflate their wholesale prices and to enhance their own profits.

"This is the year to make it from the champagne houses to the distributor to the liquor store," Giannioses said. "Not everyone is gouging, but prices will be increasing over the next five months."

The champagne industry could use the boost. Sales in the United States have fallen from a high of 19.4 million cases in 1985 to 12.2 million cases in 1998.

The consumer panic might be especially acute in Los Angeles, a town that has historically been partial to the bubbly. Still, not everybody is worried about Los Angeles running dry.

"There are going to be substantial quantities of really top-quality champagne arriving by September," said Myerson. "There should be well-stocked shelves in the city."

The reason is that grocery and club stores, anticipating there would be a large demand for champagne, began placing their orders more than 18 months ago, even for the very best brands. Myerson said that after the fall shipment arrives, nobody really knows just how intense champagne buying could become.

While he believes there will be plenty available, he does have one caveat:

"It is hard to say what the true supply situation in France is," he said. "The champagne houses have changed hands so many times and the amount available and projected to be available has changed several times over the past 12 months. No one really knows if fresh supplies will be made after the fall and at what prices."

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