THE MANY FATALITIES among wine drinkers in Italy, a reaction to contamination by wood alcohol, was a catastrophe. The scandal is having an effect on Italy far in excess of what seems to be justified, and it has given rise to some irrational steps by government agencies, retailers and consumers. The decision of Safeway's management, for instance, to remove all Italian wine from more than 1,100 supermakets, and the recommendation of the Bureau of Alcohol, Tobacco and Firearms that all Italian wine sales be halted in America, were symptomatic of the overreaction.

As of this writing there is no evidence that any Italian wines approved by the Denominazione di Origine Controllata (DOC) and shipped to this country have been contaminated with methyl alcohol. Government analysis, inspired by the scandal, has turned up traces of diethylene glycol in some Italian wines here. But the vast majority are "clean" and don't deserve the approbrium being heaped on those few products of unscrupulous producers.

Imagine what would happen if, say, some of the cheap wine grown in southern France and drunk in great quantities in that country were discovered to be poisonous. Would liquor store operators go down their aisles pulling older first- and second-growth bordeauxs off the shelves, or even less prestigious wines? If some of the bulk wine produced in California were contaminated, would you toss out your better chardonnays? The answer, obviously, is no.

The same holds true for fine Italian wine, and there is a great deal of that. For the most part it is well made, often with technically sophisticated methods and equipment based on the latest developments in California and elsewhere, by principled producers whose families have been making good wine for decades, even centuries. The addition to fine wine of wood alcohol or glycol would be unthinkable to the average producer. This kind of tampering apparently occurred almost exclusively in the lowest category of wine, where taste is relatively unimportant, although a few out of hundreds of DOC wines have been implicated. Cheap bulk wine of the sort that gave rise to the scandal doesn't ordinarily reach these shores although, again, there are a few exceptions.

There is little supervision of what goes into Italian table plonk. The making and selling of Italy's best wine is subject to rules of the DOC, much like France's Appellation d'Origine Contro le'e, which regulates about 10 percent of the country's production. The agency specifies which grapes may be used in which wines, their origin, alcoholic content, vine production, methods of vinification and aging. The DOC has been in existence for more than 20 years and, until the scandal, was credited with doing a good job.

Italy produces and exports more wine than any other country. For my part, I am not going to stop drinking it, but I am going to pay more attention to the producers, and avoid the jug wines often served at mass mixers.

Until recently, prices for good Italian wine were slated for a 25 percent increase. There is nothing in the industry quite as disinflationary as contamination -- a crime that hurts wine of every nationality.