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Reuters reports that while cheap wine that goes for two dollars a bottle has captivated Californians over the past year, rising bulk wine prices may not support that segment of the business for very much longer.

Trader Joe’s started the trend with $1.99-per-bottle wines from Charles Shaw, which was quickly dubbed “Two Buck Chuck” by consumers -- and bought up so fast that the chain had trouble keeping it in stock. It reportedly has been the fastest-growing table-wine brand in the US wine industry's history.

Since then, chains such as Kroger, Safeway, Raley’s, Bel-Air Markets and Nob Hill Foods have all gotten into the act with their versions of the wine.

But the glut of inexpensive grapes that made it possible could be coming to an end. Reuters reports that wines that used to sell below $1 a gallon now are at $1.20 to $1.50 per gallon, and prices are climbing. In addition, retailers may have to discontinue them because the cheap wines are cannibalizing the sales of more expensive wines.
KC's View:
We were at a birthday party in Santa Monica a couple of weeks ago, and there was quite a conversation about “Two Buck Chuck.” Some people said it was swill, some said it was pretty good.

When we were at a Trader Joe’s in Redondo Beach, however, we couldn’t help but notice pallets of the stuff being wheeled in to fill in big empty spots on the shelves.

Here’s a completely subjective reaction, however. This time around, we were less impressed with the Trader Joe’s wine department than we have been in the past…which leads us to wonder if by pushing the “Two Buck Chuck,” Trader Joe’s could be also pushing its luck.